Mergers & Acquisitions

Professionals in Mergers & Acquisitions generally agree that 50-75% of all deals never provide the benefits they promised when they were originally presented, or take too long to produce them. In addition Management generally feels that only 40% are successful. KPMG confirms that 80% of all mergers fail because of Cultural issues. This is why we focus on Cultural Due Diligence during the post merger integration process.

Failures in M&A are traceable to:

• Growth targets for growth sake
• “Ego” gets in the way of rationale
• Insufficient homework
• Incomplete due diligence
• Unrelated diversification
• The most common reason: Poor integration and “business as usual”

At Paul Bergé International we believe that mergers have the greatest chance of being successful if:

• The strategy is based on filling gaps through acquisitions.
• Dedicated teams are created to manage well-tuned Integration processes.
• All the facts are on the table.
• Plans are developed for people retention.
• There is a shared vision between acquirer and target.
• Short-term wins for acquired employees can be demonstrated.
• Long-term wins for all are planned for and produced.
• There are similarities in chemistry and culture.
• Integration plans are implemented rapidly so as to restore stability ASAP.
• One doesn’t try to please everyone.

We are specialists in managing the M&A process from start to finish. Our main focus is on post-merger integration as this is the area that is most often ignored or where the acquirer does not want to rock the boat.

When working with a client we start by jointly defining the M&A drivers:

• Access to new Geographies
• Increase the Customer base
• Access to new Technologies, Products, Processes, IP and Skills
• Diversification of Product / Service offering
• Cash flow

We then develop Goals for Successful M&A. This is then followed by the following detailed steps keeping in mind that we are not a law firm nor an accounting firm but M&A specialists:

• Get understanding of the industry and market place
• Get participation and buy-in from critical employees
• Define success factors and metrics
• Align M&A strategy with corporate strategy
• Define communications needs
• Evaluate target selection criteria
• Define potential targets and how they fit the strategy
• Approach short-listed targets
• Select the ideal target
• Apply criteria and valuation methods
• Reach agreement in principle with target through submission of Letter of Intent (LOI)
• Provide Guidance for and support of the Due Diligence process
• Manage Outsourced due diligence activities
• Review Due Diligence Progress Reporting on Regular Basis
• Create Integration Team if different from due diligence team (generally not recommended)
• Activate the integration teams:
  • First day plan
  • Execute communication plans
  • Corporate registrations
  • Monitor integration activities and progress
  • Take corrective actions where required
  • Conflict Resolution
  • Corporate culture
  • Evaluate feedback
• Manage transitions:
  • Employees
  • Suppliers
  • Customers
  • Customer Service
  • Service providers
  • Operations and programs
  • IT, email addresses, networks and systems
  • Corporate identity on stationary, buildings, uniforms, vehicles, marketing materials
• Measure success and take corrective action:
  • Adjust M&A strategies if required
  • Transfer experience to next project
  • Organize regular employee meetings for feedback

Call us to see how we can help your organization.