Completing an M&A deal is a big challenge for buyers and sellers. Due diligence on finance organization is clearly a missing piece in the pre-deal phase for many players.
From target selection, due diligence, bidding, valuation to financing, there are always people from finance co-piloting or leading a particular deal phase.
Even once a deal is closed, the role of finance is fundamental for delivering all post-merger integration agendas like re-planning exercise, accounting & reporting, synergies tracking, value delivery and building a new finance organization.
Purely from buyers’ perspective, you put much effort behind numbers, preparing finance models including sensitivities, scenarios, valuations and various market assessments.
But based on my experience, there are key benefits to having a target company’s finance organization due diligence on the agenda when completing an M&A deal.
Simply because as a buyer, you will:
◻️ Understand the structure of finance organization
◻️ Know about finance management qualities
◻️ Have a view on current ERP/CPM infrastructure
◻️ Accelerate early changes in finance management
◻️ Speed up new finance TOM design
◻️ Anticipate reporting limitations
◻️ Accelerate SLA preparation for finance
◻️ Be in a better position to retain critical talents
◻️ Identify & mitigate risks before day1
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