Assessing An Investment in the China Hot Pot Sector

Services Provided: Due Diligence

The Challenge

A leading Hong Kong based global private equity firm was interested in acquiring shares in a privately held top tier hot pot chain in China. In preparation for this potential investment, they hired CSA to conduct thorough due diligence in China, to assess the market dynamics and mitigate any associated risks.


Our Solution

We worked closely with the Mainland China investment team and jointly conducted a due diligence focusing on three key areas.

  • Potential Investment Risks

  • Overall Market Attractiveness

  • Overall Target Company Assessment

We interviewed all key company management over a three day period, and visited branch offices and stores in 6 key cities including Beijing, Tianjin, Shenzhen, Guangzhou, Lanzhou and Wuhan. We also looked at financial performance, operations standards, HR management, real estate selection, the supply chain and franchising systems.


Results

No major red flags were found and the project was approved by the firm’s investment committee.

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Assessing the Market for Western Fine Foods in Asia Pacific