By Guido Stein and Marta Cuadrado
In Part One, we addressed the key reasons why companies decide to pursue merger, the reasons why many of them fail, and the realities of mergers. In Part Two of this article, we will discuss human due diligence in Section 1. Section 2 will focus on the importance of merger and integration committees. Finally, in Section 3, we will offer a practical guide on how to professionally survive operations of this kind.
Acquisitions affect everyone involved to one degree or another. They are not neutral transactions in any sense: not from a financial, tax, legal, operational or commercial perspective, and especially not in terms of how they impact the people in both companies involved and other stakeholders (shareholders, suppliers, customers, etc.).
For many companies, mergers by acquisition have become a recurrent strategy for dealing with competition, gaining market share, or simply ensuring their survival. Their impact on stock markets is noted within hours, but their consequences for the people who live through them are rarely reflected in the media.
In tackling these issues, we will draw on the experience of managers who have gone through merger processes and ground our discussion in the scientific literature.