SPG professionals have been actively involved in M&A transactions for many years. During the course of this, we have seen several common themes emerge:
- In today’s highly acquisitive environment, one is often faced with the practical problem of juggling multiple deals, each with its own set of complexities and fast-paced schedules.
- Resources are continually stretched as people struggle to support due diligence activities for many deals (while doing their “day jobs”).
- Due diligence tools and processes for handling these may be fragmented and distributed across many parts of the organization.
- Decision making collateral may reside with a few individuals, often in the form of simplistic excel spreadsheets or checklists.
- The due diligence process is somewhat ad hoc and changes with each new deal.
- Senior leadership does not have sufficient transparency into the status of each deal…a problem that is made more difficult in today’s global environment involving travel and frequent time out of the office.
If any of these sound familiar, SPG can help by bringing expertise to all elements of the deal value chain through its M&A consulting and platform-based management capabilities.
SPG’s professionals have many years of transactional experience in a variety of industries including technology, healthcare, IT, CPG and manufacturing, and can augment internal resources at each step of the transaction:
- Prospecting and deal origination: Using a large business network and proprietary databases, SPG can help identify high priority areas of interest, initiate discussions with senior management on an anonymous basis and qualify targets according to pre-defined criteria.
- Financial and technology due diligence: SPG personnel have represented dozens of private companies and understand the nuances of private company financials. They also have strong technical and operational experience building, running and evaluating technology-based companies, and are uniquely positioned to conduct technology due diligence to answer questions around:
- Technology strategy and portfolio of the target;
- Strategic fit with acquirer’s growth objectives;
- Development roadmaps and risks;
- IP positioning;
- Required level of investment and decision gates;
- Competitor offerings;
- Current and future market segments / customers;
- Supply chain, R&D, QA, sales and marketing opportunities;
- Opportunities for efficiency gains or cost reduction;
- Scalability of processes, practices and tools with company growth;
- Skills / capability gaps; and
- Technical manpower and human capital requirements.
- Deal structuring, negotiation and financing: SPG has closed numerous transactions with private companies and knows how to work with private sellers. Its experience base extends across multiple financial strategies, including financial restructuring, acquisitions, divestitures and mergers, management buyouts, mezzanine capital raises, special situations financing, ESOPs and private equity and VC transactions.
- Post-acquisition integration and management: Consider the following:
Only 43% of 300 merged companies outperformed their peers in total shareholder returns (poor post-deal integration was identified as the major factor responsible for this).
62% of respondents in a survey of senior executives in 162 organizations listed successful post merger integration as the top challenge following an M&A transaction.
Yet, fewer than 20% of the companies consider the steps necessary to integrate an acquisition into their organization! And failure to promote effective integration can lead to poor morale that may affect the entire company!
SPG can alleviate this through a very structured approach with a 30-day assessment and planning phase, followed by a 90-day integration implementation phase with distinct goals, timelines and deliverables.
SPG has partnered with Phase 5 Group, and is certified to implement its EON platform specifically designed to manage business improvement. EON can simplify and improve your M&A due diligence process by:
As part of its offering, SPG will work with you to transition your existing due diligence process into the EON platform (and add specific subject matter expertise / content as-needed) to provide several benefits including:
- Setting and managing strategies;
- Executing and tracking specific deals through heat maps and scorecards (illustrative example below); and
- Analyzing performance activities.
- Standardized and consistent application across all deals;
- Institutionalizing of the process and knowledge sharing across all functional areas;
- Common project management capability for all business units; and
- One-click visibility into the status and actions of all deals from anywhere in the world.