Identifying the right growth opportunities for your business requires having a trusted team by your side.
In order to make intelligent and effective decisions, efficiently allocate resources for scale, and ensure you receive the most value out of a transaction, it’s important to consider hiring a variety of skilled M&A consultants. These functional leaders can provide various subject matter expertise and help guide the project in the right direction, eliminate redundancies, and foster collaboration and efficiency every step of the way.
As experts in helping organizations overcome the complexity of the M&A process, we’ve outlined various things you need to know about M&A consultants – and some of the signs it’s time to hire one.
Important things to know about M&A Consultants:
- What a merger and/or acquisition is
- Skills & job duties of M&A consultants
- Benefits of hiring an M&A consultant
- Signs it’s time to hire an M&A consultant
What is a merger and/or acquisition?
A merger is a type of business transaction in which two separate entities are combined and both parties bring mostly equal value to the table. Whereas an acquisition occurs when one organization buys, takes over, “acquires”, and has controlling interest over the other. There are many derivations of these basic types of business combinations.
The goal of a merger or acquisition will vary depending on the entities involved, but common reasons for embarking on an M&A transaction are to expand to new markets, develop a competitive edge, and create more value for organizations and their employees, customers, and stakeholders.
Both mergers and acquisitions are complex processes that require a lot of up-front planning and collaboration. However, when conducted correctly alongside a trusted team of consultants, mergers and acquisitions can be a lucrative and innovative path for businesses looking to scale.
Common M&A activities:
- Corporate Strategy Development
- Valuation Analytics
- Sell-side & Buy-side Due Diligence
- Integration of Employees, Processes & Systems
- Legal & Regulatory Compliance
- Equity & Debt Financing
- Purchase & Disposition Accounting
- GAAP Compliance
What does an M&A Consultant or team do?
From identifying strategic growth opportunities to integrating change management programs after a deal is signed, M&A consultants or teams play a central role in successfully guiding organizations through the complexities of buying, selling, and/or merging with another entity.
This may involve eliminating redundancies within systems and processes to supporting an organization through an audit, ensuring compliance with US GAAP, and preparing quarterly and annual financial statements that meet today’s stringent reporting requirements.
Without proper management, the M&A process can soak up an organization’s time and resources, distract from overall goal strategy and development, and leave employees feeling confused and unsupported as processes and systems are changed or eliminated.
However, by developing an integration roadmap, ensuring key project deadlines are efficiently executed, and identifying synergies across people, processes, and technology, M&A consultants act as key partners to foster collaboration and alignment while ensuring an organization receives the most value possible out of a transaction.
Skills & job duties of various functional M&A Consultants:
- Developing and integrating financial functional, and operational strategies to drive efficiency.
- Implementing systems to ensure valuations are accurate and reliable.
- Conducting sell-side and buy-side due diligence to identify and mitigate risks, establish accuracy and reliability of pricing structures, and ensure that all assets can be sold for a profit.
- Ensuring compliance with US GAAP, including purchase and disposition accounting.
- Supporting an organization through an audit by communicating with auditors, conducting due diligence, and preparing required documentation.
- Providing support for transactions by executing key project deadlines and driving process efficiency at every stage.
- Combining people, processes, and technology to foster efficiency and eliminate redundancy after a deal is signed.
- Ensuring the integration and any newly created processes are established in compliance with laws, regulations, standards, and best practices.
- Managing and arranging funding to ensure completion of the merger or acquisition.
What are the benefits of hiring an M&A Consultant?
- Ensures proper planning and allocation of resources.
- Streamlines implementation of processes and technology.
- Establishes compliance with laws and regulations.
- Helps overcome issues with fundamentals or governance.
- Ensures successful management of stakeholder, auditor and/or investor requests.
When should you hire an M&A Consultant?
If your organization is considering growth via merger or acquisition, hiring a consultant as soon as possible before and after term sheet signing can be incredibly beneficial for setting the stage for an efficient process, identifying areas of strategic collaboration, and successfully combining people, processes, and systems after a deal is signed and closed.
Signs it’s time to hire an M&A Consultant:
- You need help identifying strategic and transformative growth opportunities.
- You don’t have anyone on your current team who has the necessary expertise to guide the success of an M&A transaction.
- You need to determine the proper valuation of a target company or your own organization.
- It’s challenging or too time-consuming to conduct the necessary due diligence to identify risks and areas of collaboration.
- You need support with purchase or disposition accounting or ensuring compliance with US GAAP.
- You’re about to undergo an audit and need support to get ahead of auditor requests.
- You need guidance to ensure compliance with stringent laws and regulations.
- You’ve already acquired a company, but need support to ensure the integration is effectively managed.