Merger Acquisition Integration Best Practices

A well-planned process for integration for mergers and acquisitions can help you increase the value of your deal. This is a complicated process that requires the right mix of organizational, operational, finance, change-management and cultural expertise to be successful. If you do it right, you can have the potential to earn 6 to 12 percent more returns to shareholders overall than those who don’t.

The company that is acquiring must begin thinking about integration as early as possible in the due diligence and negotiations phases. An assessment of the environment of the target company can aid in shaping your approach to due-diligence meetings, top management meetings, and initial planning. In a healthcare acquisition, for example, managers used their initial insights into the culture of the target to make strategic decisions about assessing synergies and structuring integration teams. They limited the number of people that were present at the initial meetings, and also made other tactical decisions, like restricting the number of functional areas involved.

One of the key practices we observe in successful mergers is the use an organized procedure for capturing synergies. This involves putting line-leaders responsible for achieving their goals and making them accountable for their performance. It is also about integrating synergies into leaders’ annual operating budgets and plans.

It is crucial to have a management team integrated for the duration of post-close integration, which can be as long as two years. This team must be given the authority to act quickly and have access to all relevant information.

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