HR DD – when should it be invited ?

Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • #58087
    Dalia Abushulaih
    Participant

    HR, being an entity that is at times not given a seat at the table, and may not be included in the M&A discussions till later on in the M&A process. Usually ends up having to conduct DD later on in the game, however, the way a company conducts is HR practices including policies, compensation, in addition to labor relation issues that may have current or longterm large financial liabilities will create a lot of thought behind the matters such as risk, final selling evaluation, and plans for future integration, synergies, and corporate branding. When do you believe HR should be invited to the table to discuss the appropriateness of M&A’s ?

    #58323
    starla Pugh
    Participant

    Great question. In our company, we have HR involved once an LOI is signed. We believe that the finance & legal aspects are easily looked at butt the people part is just as important and should not be overlooked. Given that most deals involve people to make the company successful, it can be detrimental to the success of an acquisition if the people part is not valued.

    #58737
    Woon Pheng Ong
    Participant

    Since human capital is important in virtually all businesses and industries, HR DD should commence at the same time with all the traditional DD e.g. financial, tax and legal DD. However, this is sometimes neglected, and you have rightfully pointed out that HR DD is performed at the tail end of the deal.

    #59080
    Aly AlFaqi
    Participant

    I believe that HR DD should commence post signing the LOI and parallel to the preliminary DD by the buyer, in case a vendor DD is awaited, and prior to the comprehensive DD conducted by the buyer simply because it takes time to get into people’s minds and hearts.

    #59482
    Scott Love
    Participant

    Agree, I launch the HR workstream at the same time as the others. Frankly, I see the HR DD as a heavier lift than some of the other workstreams so would not want to delay. We dig into compensation structures, benefits package comparisons, titles/job functions, transitioning payroll, any existing liability etc, many topics. All of this work takes time and it is important to get right. I think it would be a mistake to not engage HR at an early stage in the diligence process.

    #59845
    Raymond Teo
    Participant

    In my company, HR will be involve prior to signing the LOI. But I have seem deals that only involve the HR team towards the end of the deals (especially for small companies, where compensation, structure, etc will not have any significant impact to the deal).

Viewing 6 posts - 1 through 6 (of 6 total)
  • You must be logged in to reply to this topic.

Are you sure you
want to log out?

Request a Brochure

Request a Brochure

Contact us to discuss your goals and needs!

Contact us to discuss your goals and needs!

Book a Demo

Book a Demo

Contact us to discuss your goals and needs!

Contact us to discuss your goals and needs!