Michael Okaty Offers Insight on Key Focuses for Private Equity in Value Creation

Foley & Lardner LLP partner Michael Okaty is quoted in the Middle Market Growth article, “Looking Inward: Boosting Value in a Tough Exit Environment,” offering insight on two areas private equity sponsors are assessing to maximize value creation at portfolio companies in a limited exit environment – personnel adjustments and real estate footprint.

“PE firms are looking to see if there are position that can be optimized through artificial intelligence,” Okaty said. “And they are increasingly looking at outsourcing some of the commodity-type functions, such as call center or billing functions.”

Okaty noted that real estate is an area firms are closely examining, particularly given the adoption across industries of hybrid work arrangements. “Value creation produces more revenues, whole other value creation reduces expenses to get more efficiency and increase profit margins over time,” he added. “Most people are focused on both, as there’s a saying that ‘you can’t cut yourself into profitability.”

Okaty’s comments also appeared in the full Summer 2024 issue of Middle Market Executive.