Post-merger integrationhealth check

Post-merger management is absolute key to

success, the deal is won or lost after the deal is done.

Sir Brian Pitman,Lloyds TSB

Growing firms are often looking for ways to invest in complementary businesses to achieve their expansion plans. Identification of target suitors and completing the deal is only the start of the process and critical to the success of any merger or acquisition is the post-merger integration which requires significant time, attention and resources. Without planned and focused attention to integration, many mergers fail to achieve their full potential and deliver the intended improvement in shareholder value.

Whilst there are hundreds, if not thousands of tasks to be accomplished, it is essential that they are prioritised in order to ensure proper allocation of resources and hence ensure accomplishment of the most critical objectives.

There are 7 overriding principles of the post-merger integration process which are general determinants of integration success:

1. Providing a sound, realistic, compelling vision for the long-term future of NewCo.

2. Quickly clarifying leadership and management roles, thereby reducing anxiety, confusion, misdirection and critical loss of time.

3. Focusing the integration on growth development (finding the 1+1=3 plan). Evaluating the opportunities possible in consideration of the merged firm’s customers, capabilities, competitors, costs and culture.

4. Planning for and accomplishing early wins in order to rally resources, promote teamwork and community, inspire staff and establish momentum.

5. Identifying and acknowledging that cultural differences exist and specifically planning to benefit from the best of each firm’s culture, whilst remembering that the dominate culture may remain in the long term.

6. Preparing an effective and detailed communication plan which will address all of the stakeholders including customers, directors, employees and the market generally.

7. Identifying and mitigating risk. Risks should be proactively managed and brought to the attention of the integration leader who is responsible for day to day management of the integration.

Post-merger integration health check

2 Post-merger Integration Health Check

So, what can you do to ensure success?

Post-merger integration health check

Post-merger Integration Health Check 3

Common issues we have found which create challenges to successful integration are:

• lack of clarity over the integration strategy

• starting too late with your Day1 and integration planning

• not taking control of the business appropriately on Day 1

• not considering the message you want to give to your people and your customers on Day 1

• lack of clear leadership for integration resulting in decisions not being taken

• business as usual is forgotten and runs ‘out of control’

• no focus on prioritising and delivering synergy benefits

• not managing the impact of the integration on your customers and your people.

We are able to offer a health-check at any time, pre-day 1 through to completion of the integration, thus providing assurance that you have taken all the appropriate steps to drive success and deliver the forecast benefits from the merger. Our health-check involves reviewing your processes covering:

Pre-Day 1AccountabilityBenefitsGovernanceCommunicationsPeople Management

Post-merger management is critical to success.Call Gail Chadwick for a consultation.

Post-Day 1Delivery of integration plansIssue resolution and decision takingResource prioritisationBenefit trackingBusiness as usualOngoing communications

Gail ChadwickDirectorT +44 (0)1534 885740E gail.chadwick@gt-ci.com

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These notes have been carefully prepared as general guidance only. Grant Thornton Limited can accept no responsibility for loss occasioned by any person acting or refraining from action as a result of any material in these notes. On any specific matter, reference should be made to the appropriate adviser.

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