The role of CFO in M&A

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

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  • #110165

    Connie Howe
    Participant

    Why not all CFOs can handle M&A? What role a CFO should play in a M&A deal (beyond the traditional finance tasks such as financial analysis, financial forecast and obtaining finance)?

    #110328

    Sonia Shah
    Participant

    That’s a great question to think about!

    CFO’s are an indispensable part of a company’s corporate structure, working to strategically increase profitability while ensuring that accounts are managed, taxes are filed, cash flow remains strong, and company leaders and investors are kept in the loop.

    Although the job of a CFO requires a broad range of abilities, one area that’s frequently beyond the typical CFO’s skill set is the mergers and acquisitions process. There are numerous CFOs who are excellent in their normal roles but may not have the necessary expertise to see a deal through to completion.

    A CFO with deal experience is, in my opinion, not needed — the company would end up paying a lot for skills that are only relevant for a short amount of time before the CFO goes back to other day-to-day responsibilities.

    A better option may be to outsource the additional dealmaking skills only for the period that they’re needed. This is appealing for three reasons: First, hiring is a long, attention-hogging process. If your company is already being approached about a transaction, your board doesn’t have time to hire a new CFO. Second, there is no training required, as the current CFO already knows your business’s functions, processes and other important details. Finally, you would be outsourcing to the experts in dealmaking, setting your company up for the most successful deal possible.

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