Infrastructure Stewardship Due Diligence
An asset base can hide an accrued capital obligation. We uncover it.
An operator can hold service and earnings steady for years while spending less than its asset base needs. The shortfall does not disappear. It accrues in the assets as a capital obligation the accounts do not carry and the price does not deduct.
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The accrued capital obligation is not reflected in the accounts, so it is not in the vendor's model or the buyer's. The price can assume assets are in better condition than the ones being bought.
The Price
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Renewal deferred by the seller can fall due during the hold, paid from the new owner's cash flow. The shift from planned to reactive maintenance that comes with deferral may already be under way, and already showing as rising operating cost.
The Hold
Renewal not done in the hold remains in the asset base at exit, where the next buyer's adviser reads the same register. What it finds comes off the price. An owner that has renewed on plan can evidence it from the same records.
The Exit
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Illustration of what ISDD can find
What is Infrastructure Stewardship Due Diligence?
A buyer has a few weeks to decide whether to believe the seller's account of its asset base: that renewal has kept pace, that the forward plan is sufficient, and that maintenance cost is under control. Infrastructure Stewardship Due Diligence (ISDD) tests those claims against the seller's own records.
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ISDD provides an independent, records-based assessment of how the asset base has been managed: whether renewal has kept pace with asset life, whether the forward plan is funded to close the gap, and whether the cost of deferral is already showing in operating cost. The findings are reported as figures for the buyer's model and as items for the sale and purchase agreement.
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The assessment is built on ISO 55001:2024 and the GFMAM Asset Management Landscape. What it adds is the economics: converting what the standards measure into what it is worth in the buyer's model. It works alongside technical and financial due diligence within the same window.
Has renewal kept pace with the age of the asset base, or has it been deferred?
When Deal Teams Call Us
What the CIM doesn't say about the asset base.
"Has renewal kept pace with the age of the asset base, or has it been deferred?"
"Capex has matched depreciation for a decade. Does that mean the asset base has been renewed?"​
"If we take the seller's forward plan at face value, what asset life does it imply?"​
"How much of the accrued obligation falls due during our hold, and how much lands on the exit price?"​
"Is the rising maintenance cost the start of a trend, or has it already been trending for five years?"
"What will the next buyer's adviser find in the same records?"