Interview – Sophie Moreau-Garenne, SO-MG Partners

DEALCOCKPIT: Can you introduce yourself?

Sophie Moreau-Garenne: I'm Sophie Moreau-Garenne, founding partner of SO-MG Partners, a financial consultancy specialising in complex situations. We work with companies facing financing problems, whether due to a slowdown in business activity or a sharp acceleration, for example when working capital requirements consume cash or when financing lines are ill-suited to the company's cycles.
We are also involved in transactional contexts, providing assistance with disposals and due diligence for acquisitions. For specific transactions, we can also carry out M&A and valuation assignments.
In short, we are a 'one-stop shopping' boutique with comprehensive skills, enabling us to respond to requests for restructuring, due diligence, M&A and valuation, the common denominator being the context: complex and with cash issues.

DC: Can you tell us about the origins of your firm and what motivated you to set it up?

Sophie M.: After working for the Big 4 for many years, I was asked to open the French practice of an American firm, which was my first step towards entrepreneurship. The creation of SO-MG Partners was a response to my desire to serve business directors to the best of my ability and to build a long-term relationship based on trust and respect.
Once in, it seemed quite evident that a different consulting model could be put in place to serve companies: adapting the professionalism of large firms to medium-sized structures, tailoring services, being agile and 'glued' to the terrain.

DC: Your firm specialises in financial advisory services. What are the particularities of this business and how do you distinguish yourself from generalist firms?

Sophie M.: Whatever the context, our approach involves an in-depth analysis of the business model and its cash generation. Understanding how cash flows through a company is in our DNA, so we can quickly understand each particularity and each sector.

DC: Do you have a typical clientele?

Sophie M.: No, from SMEs to large enterprises in all sectors, we like to create exchanges and pass on knowledge, which is what business directors look for in us.

DC: You are a multilingual firm. Do you have an international clientele?

Sophie M.: Yes, we work for international large enterprises and foreign shareholders in French companies.

DC: What are the main challenges companies are facing in terms of financial management, and how do these differ between French and foreign companies?

Sophie M.: The uncertainty linked to the geopolitical context and the loss of confidence in the future is a phenomenon that destroys value for companies. It is a vicious cycle from which we all hope to emerge quickly. French companies are undercapitalised and therefore more affected.

DC: How does your firm proactively address these challenges?

Sophie M.: We encourage managers to take a long-term view and to think about an alternative version of their company to the 'worst case' scenario. This is very important for setting a course.

DC: How does your team adapt to the specific needs of each client in terms of restructuring and preventing difficulties? Are there certain approaches that you prioritise?

Sophie M.: Our role is to render financial information intelligible, to be a force of proposition and to make our network of targeted experts available. We always assemble a crisis team with specialised lawyers, crisis managers and specialists in stock, factoring, etc., and we encourage exchanges and cross-training with our peers, lawyers, bankers, and court-appointed administrators.

DC: Your close involvement with business directors in complex situations helps them assess the future and bounce back more easily. In what way does the human element play a crucial role in the financial services industry?

Sophie M.: We work in a context where the psychological aspect is crucial, with executives who often put their company before their own health. Yet, the health and energy of the CEO is a veritable immaterial asset for the company.
Good financial restructuring also means understanding the links between the professional and the personal, in terms of securities, remuneration, personal assets and so on.

DC: Can you share a particularly notable customer case where SO-MG Partners played a key role in the process?

Sophie M.: SO-MG Partners supported the investment fund Jolt Capital in its planned acquisition of the BioSerenity group. Jolt Capital, which has over €500M in funds in its portfolio, is considered to be one of the leading growth capital funds for European technology companies (deeptech).
The BioSerenity Group is a leading Health as a Service solution provider creating AI-enhanced connected medical solutions for the diagnosis of patients with chronic diseases (in cardiology, neurology and sleep disorders).
The firm's mission was to advise the fund, successively:

1. In formulating the offer, defining the scope of the takeover, assessing the ROI and estimating the financing requirements associated with the deal;
2. Post-acquisition, as part of the operational measures to integrate the acquired companies.

DC: That is impressive! How do you assess a company's financial viability when it is looking for funding? What criteria are essential in your valuation process?

Sophie M.: Analysing the future value of the company is essential in our restructuring cases, even if we often negotiate to preserve short-term interests. It is vital to look at the company's position in its market, the barriers of entry, the know-how it has accumulated, the data collected…

DC: How is the role of M&A currently evolving in your firm and what are the main trends you are observing in the field today?

Sophie M.: The increase in debt post-Covid with the granting of PGEs (state-guaranteed loans) has led to imbalances in company budgets, which were already significantly undercapitalised. These are fragile companies, which in tough times have every interest in reaching out to industrial or financial partners.
We are particularly noticing a strong consolidation in vulnerable sectors such as the automotive and construction industries.

DC: What role do you play in the negotiation of agreements during an M&A transaction, and how do you ensure equilibrium between the interests of the buyer and the seller?

Sophie M.: We are fervent advocates of transparency, which enables everybody involved to save a lot of time in their deals!
Our ambition is to offer positive, fair, and tailor-made solutions.

DC: How does your firm incorporate technology into its practices?

Sophie M.: Training remains a major element in our business. As consultants, we cannot be the cobbler with the worst shoes.

DC: You put your trust in DealCockpit and we thank you for that. Why have you chosen us?

Sophie M.: We look for partners who resemble us: professional tools that are powerful, effective, and result-oriented!
We like the fact that it is adapted to in bonis situations as well as insolvency proceedings.

DC: Are there any aspects we can improve?

Sophie M.: Perhaps the data archiving at the end of the transaction.

DC: Duly noted, thank you. Do you have any final advice for company directors?

Sophie M.: Stay the course!