Guest Post by Joe Augustine
Bringing separate companies together – each with distinct values, cultures, definition of success, and goals under a single roof is a daunting task. In fact, many would say that in an M&A Deal, the paperwork is easy, but where the rubber meets the road is when IT integration becomes an afterthought.
This is one of the most dangerous oversights in any M&A deal that can lead to a disastrous Merger or Acquisition. Such oversight will lead to increased overhead cost and decrease productivity. It takes longer to realize ROI as shadow IT and disjointed IT integration have impeded workflow, automation, and natural revenue drivers that could shape the organization's future. As a result, it's essential IT Consultants are brought into the deal early to help with IT challenges such as the following:
Managerial inefficiency and significant decrease in revenue
The merger of systems that break compliances and legal certifications such as ISO, SOC, FISMA, etc.
Lack of IT infrastructure knowledge
Impacts to employee morals, retention, and a waste of time and money
Technological and Automation gaps
Incompatible IT systems and Shadow IT
With that said, some of the largest and most successful M&A deals in 2021 leveraged IT Consultants. These multiple billion-dollar acquisitions, small and large, in hardware, software, and services required very strategic merger and acquisition activities in areas vital to the overall success of the M&A deal. See below:
AMD’s $35 billion bid last year for Xilinx
Salesforce.com’s now-closed $27.7 billion acquisition of Slack.
Qualtrics closes acquisition of Clarabridge for $1.1 billion
Other deals include the following:
GovernmentCIO (“GovCIO”) acquisition of SalientCRGT
TrueCommerce acquires DiCentral: TrueCentral added another 30,000 connections and 5,000 customers
As such, IT Consultants can assist at any stage of the M&A process, but a strategic M&A Advisor will bring them in early because the challenges are real and very costly to the acquisition. See below:
Separating out the real opportunities
Due Diligence in a time of social distance
Forecasting the most unpredictable months in a deal
Managing working capital and maintaining cash flow
Finding alternative financing
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Sebastian Amieva
Mergers and Acquisitions Expert
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