Lessons Learned During M&A Process
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Below pointers are what I learned from M&A Process
> Time priority
> Due Diligence process and procedure to be handled carefully
> Ensuring NDA is super confidential between NewCom and target company executives
> Pricing and handling GTM post-merger should be a top priority (Ensuring new customer has company visibility and targeted company should not overlook them)
> New employee from NewCom should not ver overlooked
> Communication for full integration to all stakeholdersPEOPLE! When going through a M&A you need to remember that you are dealing with real people, it isn’t just a company. These people have lives and they depend on their job. They are going to be nervous and want to know everything that is happening with them. Remember, these people didn’t apply to your company, they didn’t necessarily ask to work for this new company. Be compassionate.
There are many lesson learned points. But I would list 2 significant some points:
1- ensure to have access to the VDR any time.
2- appropriate/organized repository to reduce the time for the crew when searching for documents.I had following experince from my last acquisition experience :
1)increase my negotiation skills specially for price negotiations
2) increase my personal M&A knowledge otherwise I should pay lots of money to legal advisors for tiny things,Time
If Multiple acquisitions are in plate then it becomes difficulty to manage priorities for an aggressive aspirations of PEG.
Time is the enemy of all M&A deals for a seller. The price and terms typically only get worse if the process drags on, and there is the risk of the deal falling apart. New issues could arise that result in the price being lowered. The M&A process can take a very long time, and there has to be a driving force on the sell-side and timetable to get the deal to closure. It also helps for there to be a dedicated advocate on the buy-side of the deal to keep the deal moving along.Competitive Process
One of the most important steps in accomplishing a successful M&A exit is to get multiple potential buyers interested. A competitive process helps ensure getting the best price and the best terms, and allows a company to fend off unreasonable requests from one bidder.
Due Diligence Preparation
Sellers have to understand that they will be subject to an extensive due diligence investigation, and they must be prepared in advance for all that entails. The buyer will want to see detailed financial statements, copies of all material contracts, information on key intellectual property, employee and benefit arrangements, and much more. Normally, the seller needs to have all of that information in an online data room, which can be quite time-consuming to get correct and complete. Sophisticated bidders will tell the selling company that preparing a comprehensive and well-organized online data room is important. The company will typically respond that it is organized and on top of it—but the selling company often doesn’t understand the enormity of the undertaking involved.
Hi Bonnie! Jumping on the time bandwagon – everything takes longer than you think it will so it’s important to be realistic when setting deadlines and creating schedules. Adding extra time for unforeseen competing priorities is also a really good idea.
Companies consolidate to remove excess capacity, increase market access, acquire technology more quickly than it could be built, develop new businesses, and improve the target company’s performance.
Time is enemy.Engage the IMO in due diligence and begin integration planning as soon as possible. If you are not starting integration planning until after close you will begin the acquisition at a deficit.
I’ll add to have open conversations with your client (i.e. make sure to build trust and understand any challenges it may occur in the next 12 months).
My addition to this post, although I realize it’s a couple of years old, is that being flexible in the M&A process is really, really important. Flexible in terms of timing of meetings (with global acquisition targets, it can be very challenging to actually meet!), flexible with the timeline to close, flexible with communication patterns and styles and so on. I’ve definitely learned that each acquisition is unique with individual requirements and personalities. I have to be flexible and pivot repeatedly.
– Agility and flexibility are paramount
– Alignment on integration strategy with key stakeholders is critical
–Having a good communication channels between different function in the organization is a key success factor for an M&A deal.
Be super clear on the Target State strategy before close. After closure things can get lost in translation and value degraded.
For me my leasons are in timing and having the IMO present in a much earlier stage than very much to Closing. With timing it will remain a balancing act between going fast in the deal phase but staying focused on doing the right things, any mistake here can give you ‘pain’ in the stage from signing to closing.
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