Should every large and midsize company have a team or person dedicated to M&A?

This topic contains 11 replies, has 12 voices, and was last updated by  Senthilkumar Perumalsamy 12 months ago.

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  • #82365

    Clark Murphy
    Participant

    I am currently apart of an M&A team now, for the company I work for. But my industry is very active in M&A. I think its great to have a team. It makes sure that M&A activities doesn’t bother operations. We makes sure to find deals and to bring in Operations when the time is right, while they still run the day to day operations. They also will inform us, where they would like to look for acquisitions. With that in mind, I would like to know your thoughts on that should every large and midsize company have a team or person just dedicated to M&A?

    I know some industries will not be that active in acquisitions, while others will.

    #82641

    Mohamed Emara
    Participant

    I believe that there should be a team managing the M&A process. Usually companies hire many consultants to complete the transaction including initial price negotiation, due diligence, and integration. However, an internal experienced team from the company is essential to ensure proper completion of each phase and alignment with the strategy of the acquiring company and management directives. Hiring consultants provides the shareholders and customers a certain level of confidence about the expected outcomes of the transaction.

    #84097

    Gregory Gills
    Participant

    In our organization, we will consult with organizations and use that to help build our overall M&A competency. Once we have that skill set built into our organization, we will decide whether this is a full time role. However, building out companies capability with M&As layers deep and wide will allow us to be responsive should the time come.

    #84739

    Jenny Ewen
    Participant

    I also agree that an M&A team is beneficial when M&As are the norm – you gain efficiencies from experience and can over time build out really great reference material. You can also then invest in some of the new technologies that are emerging that help you to analyze and model the transaction and integration – often these technologies are not easy to learn so continuity of users is beneficial, however I’ve been looking at some of these systems and they are really amazing and bring about insights that would be very difficult to produce manually. We struggle a bit because while some roles are global for M&A, others are regional and the regional people have to go through a huge learning curve when an M&A comes up in their country. It’s a tough balance to strike because the local knowledge is useful, the global M&A knowledge is useful and yet the team would be huge if the global M&A team was too rounded. WIP for us…

    #85867

    Zach Dogar
    Participant

    I am presently a business broker, seller side and I feel that clients should come forward much earlier so that the Company can be prepared for sale to achieve the best results.

    #86501

    Christoffer Balieu
    Participant

    I think, depending on the regular level of M&A activity within the specific company, every medium and large-sized company should have at least one person dedicated to M&A. Ideally, if the company is not as active within M&As, the M&A manager could also cover another financial role within the company. Then, when the timing is deemed right, the company will have at least one internal M&A expert that has executed deals before and know exactly what pitfalls to look for in a potential deal. Also, an internal M&A expert has a better chance at evaluating if a potential buyer will fit strategically and culturally with his organization, and he can use this knowledge to act as a sparring partner to an external M&A advisor.

    #87467

    Gabriele Frigerio
    Participant

    I think it would depend by global strategy of company. If a company normally grows by acquisition, for sure.
    Differently, not.

    Surely, it would be a benefit having someone trained on.

    #89445

    Josh Liang Wee Ooi
    Participant

    I mostly echo the sentiments above. If a company has intentions to grow inorganically through M&A then having a team would certainly help. Having said that, I also think that if an organization wants to have an M&A team it needs ensure its properly resourced such that the team can increase efficiency, progress projects in an orderly way and reduce the costs of external consultants. I’ve seen M&A teams which do nothing more than validate financials and then pass on the project and co-ordination to the proposers/stakeholders. In the end, it becomes a costly internal function with very little added value.

    #90682

    Anne Becker
    Participant

    My company also has a couple teams, one within the parent company/HQ and that team works with my Division’s team when we have an acquisition. This is a new process and is undergoing on the job trials now. The two teams work together and create work streams, which will depend on the type of acquisition.

    #92270

    Melvin Ashley
    Participant

    Yes. By the time a company reaches middle market it should at least on person working on corporate development who’s sole function is looking for M&A possibilities.

    #92573

    Ang Pek How
    Participant

    Based on my opinion, i think that a dedicated M&A team is necessary only if the Company is actively involved in corporate exercises. It would not be cost beneficial to the Company to maintain a M&A team where M&A is not active in the Company or the industry as the services could be outsourced to an independent third party professional.

    #93120

    As per recent trends, a company can not survive by running its current business as it is. It has to change by itself, and it has to gain synergy and venture with others either vertically or horizontally in their business domain. It will keep them active and competitive in the market place. Keeping a dedicated M&A team will always help as they can get experience and they can strike some good opportunities at the right time rather than look for opportunities at the wrong time.

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