Problem

One of the world’s leading private equity funds commissioned a Policy Risk Analysis to support a potential transaction concerning a high-profile UK tourism asset.

Our objective was to identify and contextualise risks to continued growth in demand for the asset’s services arising from political interventions and the outlook in public policy.

Solution

WA Investor Services swiftly identified and spoke with policy-makers who had first-hand knowledge of government’s thinking.

We analysed the government’s likely stance on several policies that would affect demand for the asset. These included stability of government policy surrounding setting of school term dates, levels of flexibility allowed to schools, and fines for parents removing children from class outside school holiday dates. We also evaluated the government’s approach to domestic tourism, including the outlook for Air Passenger Duty and other tax changes impacting demand for the asset.

Our assessment of regulatory policy on workforce issues – specifically changes in national minimum wage and employment contracts – was identified as a key factor in the asset’s future profitability.

Results

WA Investor Services identified key trends in policy likely to affect the asset over the short to medium term, and advised on the opportunities and challenges this would create. This gave our client’s investment team insight to help them determine the asset’s value and informed their investment decision.