Cash has to land in Newco accounts. From Day One.

Bank selection and the account architecture.

The first decision is the Newco bank panel. The seller relationship with its existing banks does not transfer to Newco. Newco runs a bank selection process. Operating accounts, concentration accounts, payroll funding accounts, payment accounts, FX accounts, and investment sweep accounts each need a defined home. The panel design balances service, footprint, technology, and pricing. The PE sponsor often has a preferred relationship that informs the selection.

Account architecture follows the legal entity structure. Each Newco legal entity needs its own operating account in the currency of its operations. The cash concentration structure connects subsidiary accounts to a master account through zero balance arrangements or notional pooling. The structure is designed by the Newco treasurer and validated by tax counsel before account opening begins.

Multi country footprints add complexity. Each country has its own banking regulations, its own know your customer process, and its own document requirements. The Newco team builds a country by country plan with explicit dependencies on legal entity registration, beneficial ownership documentation, and director appointments. The country plan pairs with the Day One legal entity setup workstream.

The TSA period covers the gap between Day One and the Newco account go live. Newco may operate inside seller controlled accounts under a documented sub account or pass-through arrangement. The terms cover account access, transaction approval, reporting cadence, and the absolute exit date. The pricing follows the same cost-plus discipline that governs the rest of the TSA.

Know your customer and the account opening sprint.

Bank account opening is the long pole. Each bank runs a know your customer review of the Newco entity, the ultimate beneficial owners, the directors, the source of funds, and the expected transaction profile. The review takes weeks. Multi country panels take months. The work has to start the moment the carve out is signed, not the moment the Day One date is fixed.

The documentation package is consistent across banks. Certificate of incorporation. Articles of association. Beneficial ownership disclosure. Director identification and proof of address. Source of funds documentation tied to the carve out transaction. Authorized signer designation with specimen signatures. The packaging discipline reduces re submission cycles that delay account opening.

Sanctions screening runs on every party in the structure. The Newco team prepares a clean entity diagram and a clean signer list before submission. A failed sanctions screen on a beneficial owner or a director can delay account opening for weeks while the bank conducts enhanced due diligence. The screen is run privately before the bank receives the package.

Test transactions go through each new account before production transactions begin. A small inbound wire. A small outbound wire. A small ACH credit. A small ACH debit. The discipline validates account activation, signer authority, beneficiary verification, and the connection to the treasury workstation. The test results document is filed for the first year financial close.

Customer receipts and the redirect plan.

Customer payments to the carved out business currently land in seller accounts. They have to land in Newco accounts after cutover. Each customer relationship is documented. Each customer payment method is identified. Wire transfers. ACH credits. Lockbox checks. Card payments through gateway providers. Direct debits through SEPA or local equivalents. Each method has its own redirect mechanism.

Customer communication is structured and paced. Each customer receives a written notice with the new payment instructions, the effective date, and the legal entity name change. The communication is sent at least 60 days before cutover. The Newco accounts receivable team contacts every customer individually for confirmation of receipt and confirmation that internal systems have been updated. The discipline avoids the most common failure: customer accounts payable systems that continue to pay the seller after cutover.

Card payment gateways require specific work. Stripe, Adyen, Braintree, and other providers do not transfer merchant accounts across legal entities. Newco signs a new merchant agreement, integrates the new gateway credentials into the application stack, and validates payment flow before customers see the new checkout. Mistakes here are visible to customers immediately.

A misdirected payments protocol covers the inevitable cases where a customer pays the seller after cutover. The TSA section on misdirected receipts names the remittance cadence, the documentation requirements, and the fee structure. The discipline pairs with the audit rights section to avoid disputes over what the seller actually received and remitted.

Supplier payments, FX, and the technology stack.

Supplier payments rebase from seller accounts to Newco accounts. The Newco accounts payable team builds the supplier remittance file from the new accounts. Wire transfer beneficiary records, ACH origination authorities, and global payment service files all get rebuilt with the new account information. Each payment file is tested in a non production environment before the first production batch lands.

FX exposure has to be re hedged. The seller hedging book includes positions that supported the carve out business. The seller will not assign those positions. Newco builds a new hedging policy, opens FX trading lines with the panel banks, and either rolls forward the seller positions through novation, or unwinds them and establishes new positions. The policy decision sits with the new treasurer and is approved by the audit committee.

The treasury workstation moves to a Newco managed environment. Kyriba, FIS Quantum, GTreasury, ION, or the ERP native treasury module each support a Newco implementation pattern. The implementation covers cash positioning, bank communication through SWIFT or host to host, payment workflows, FX deal capture, in house banking, and accounting integration. The implementation runs in parallel with the bank account opening sprint.

Bank statement integration with the ERP completes the picture. BAI2 files, MT940 files, and camt.053 files feed the Newco general ledger reconciliation. The bank communication channel is tested end to end before Day One. The discipline aligns with the Day One treasury cash management framework.

Cutover, controls, and where it goes wrong.

Cutover sequences the banking workstreams around the Day One payment calendar. Final receipts land in seller accounts before cutover and remit to Newco accounts under the TSA. Final payments process through seller accounts before cutover and convert to Newco accounts thereafter. Payroll funding moves to Newco accounts as soon as the new accounts are signer ready. The runbook names every owner, every signer, and every dependency.

Internal controls activate from day zero. Dual signer requirements above thresholds. Positive pay file submission to each bank. ACH origination approvals. Wire transfer call backs with named treasury contacts. The control framework is signed off by internal audit and external audit before the first production transaction runs. The discipline avoids the most common Newco fraud loss in the first 90 days.

The most common timeline slips trace to delayed account opening on multi country panels, late discovery of supplier banking detail changes, and customer remit instructions ignored by accounts payable departments. The fix is the disciplined country plan, the structured supplier outreach, and the customer level confirmation of receipt of the new instructions. Where these controls hold, Day One cash flow is uneventful.

Programs run between $400K and $2M depending on country count, account count, treasury workstation scope, and customer base complexity. The work is delivered under a Fixed Fee + Portfolio Retainer engagement model through TSA exit acceleration, often with explicit treasury subject matter expertise on the engagement team.

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