How important is cultural fit in M&A due diligence and what mechanisms are used?

This topic contains 1 reply, has 2 voices, and was last updated by  Ingrid Holbik 5 months ago.

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  • #103301

    Lina Lorenzo
    Participant

    I am curious to see how most companies are handling culture when conducting M&A, particularly during the Due Diligence period. I see in all literature that Cultural fit is crucial to successful M&A, but I wonder how much of it is actually done in practice and what mechanisms are executives using to evaluate culture during the very tight and sometimes constrained space of a Due Diligence period.

    #103414

    Ingrid Holbik
    Participant

    Without getting the proper references; I believe that a good proportionate of deals (50%) of those that fail are due to culture fit in some degree.

    Strangely there is no enough that executives do about it. Probably because in the absence of a deal, very few companies and executives focus on management of culture. So the question then is; why bother when doing a deal. So until we can prove the value of culture on a standalone value; it will be difficult to articulate the value of culture in a deal.

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