Merger Acquisition Integration Considerations

One of the most important aspects of successful merger acquisitions is the integration phase. Many companies overlook this until it is too late, the process of acquisition integration can make or break the deal. The integration of acquisitions is a huge undertaking that requires dedicated time.

Many companies fail to realize the forecasted financial improvements from a merger due to inadequate M&A integration planning and execution. The most important reason is lack of alignment and commitment among the leadership team that aids integration processes. The first step is to identify and develop those with the drive and ability to effectively lead integration efforts. This includes the M&A team, as well as all the functional teams involved, like finance and human resources, operations and so on.

Another key element of M&A integration is the implementation of clear tracking mechanisms that link the process to the P&L. This means establishing specific KPIs that reflect the business model of the target company and not only the acquirer’s. This ensures that the correct measures are tracked and the appropriate goals are set.

An integration director should be involved as soon as possible. This could be done as part of the diligence process. It can increase the value of the target by identifying synergies that are not being realized. A good integration director will be able spot these opportunities before the deal is closed and aid in ensuring that they are taken into account in the target’s value.

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