During Due Diligence, our company identifies potential synergies that can be achieved post-close. Many times, Day 1 activities that allow a more granular look at business operations have altered our view of the priorities of these synergies. Day 1 activities have also been known to change our initial synergies and shape them into something that looks completely different than the Due Diligence evaluation.
How many of you have been surprised by Day 1 findings to the degree of reshaping many identified synergies? Has your company been successful with Due Diligence evaluations to where you did not have to divert/re-shape at all?
In one situation our findings in Day 1, made me change the look of the project completely. What I thought it was going to be an easy integration became a nightmare. My experience tells me that DD focus too much on financials, a little bit on strategy and 0 on the rest. It is in the rest where you find Day 1 surprises.
We had an instance where we had underestimated the need to conduct a full Cultural DD which resulted in a whole host of problems on Day 1 & beyond – particularly around how the work was performed by the Target & the management behaviors that existed resulting in significant abrasion between the Target’s employees & our own. In the end, significant synergy opportunities were missed & it was a 2-year nightmare post-close.
You must be logged in to reply to this topic.
Necessary cookies are absolutely essential for the website to function properly. This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information.
Any cookies that may not be particularly necessary for the website to function and is used specifically to collect user personal data via analytics, ads, other embedded contents are termed as non-necessary cookies. It is mandatory to procure user consent prior to running these cookies on your website.
Loading.. Please wait