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Merger Acquisition Integration Best Practices

A well-planned merger acquisition integration procedure can help you achieve a higher percentage of your deal value. This is a complex process that requires the right mix of organizational, operational, finance, change-management and cultural abilities to succeed. If you do it right, you can deliver as much as 6 to 12 percent higher returns to shareholders overall than those that do not.

The acquiring company should begin contemplating the process of integration in the earliest possible time, during the due diligence and negotiation phases. A thorough assessment of the cultural environment of the target could help you to shape your approach to due diligence meetings at the top of management as well as initial planning. In one healthcare acquisition, for instance, managers utilized the initial insights they gained into the culture of the target to make strategic decisions about assessing synergies, as well as structuring integration team. They made tactical choices such as limiting how many people attended the initial meetings, and limiting the number of functional areas.

We’ve identified a method to capture synergies in large mergers that have been successful. This involves putting line-leaders responsible for reaching their goals and holding them accountable for their performance. It also involves integrating synergies into leaders’ annual operating plans and budgets.

It is essential to have a well-integrated management team for the duration of the post-close integration timeframe, which could be up to two years. The team should have the power to act quickly and access to all relevant data.

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