- Service: Advisory, Transactions & Restructuring, Transaction Services
- Type: Business and industry issue
- Date: 25/03/2011
Research from KPMG International shows that only 30 percent of deals deliver shareholder value.
We are able to work with clients at different stages of the transaction lifecycle aiming to help ensure deal objectives and value targets are met in a timely manner, with minimal disruption to business as usual.
We are able to provide merger, joint venture and acquisition support, focused on synergy evaluation, integration planning and post deal execution.
What's on your mind?
- Identifying the appropriate integration strategy and approach to unlock the deal value.
- Effectively using the time pre-completion to prepare for Day one and accelerate integration planning.
- Quickly taking control of the new business, combining with the existing business and minimising disruption to business as usual.
- Ensuring the synergy targets (cost and revenue) are translated into integration plans and tracked/delivered post deal.
- Dealing effectively and pragmatically with the ‘softer’ people issues at a time of organisational change and disruption.
How we can help
- We support clients in the development of the integration strategy and help them ensure that operational, financial and integration objectives are aligned to this.
- We focus pre-deal on the short term Day one issues to help clients take immediate control of the acquired business.
- We help clients to mobilise and resource an integration team and programme focused on building and delivering practical, detailed integration plans.
- We help clients to focus the integration programme on priorities that could deliver expected benefits (including quick wins), and on mitigating key issues.
- We help clients to ensure that the people and cultural aspects of integration are prioritised as much as the financial targets.
- We provide challenge and objectivity to the integration process.
Supporting achievement of deal value through:
- An objective evaluation of synergies and integration issues.
- Our experience, our deal insights and our structured approach.
- Provision of support across the transaction cycle from pre-deal to post-deal implementation.
- Focus on the “hard” and “soft” elements of transactions taking into consideration the financial elements as well as people and cultural issues.
- Working collaboratively with clients so that the business retains ownership of the integration.
- We have a record of helping clients deliver value from their deals.
- Our team of transaction experts understand and have experience of assisting clients with the associated challenges, and can work collaboratively with you to help achieve your goals.
- We have collective experience of over 500 deals, with the sector expertise and global reach through other KPMG member firms to support your M&A activity across the world.
- One of the world’s leading brewers globally, was acquiring an iconic Brewery and drinks business.
- The prime value driver behind the deal was expanding global footprint, and delivering strategic revenue generation opportunities that cross selling brands in their respective core markets would deliver.
- Other value drivers included implementing operational best practice in Supply Chain, Sales & Marketing, Finance, IT, HR as well as optimising global procurement.
- The transaction was particularly complex and included managing early exits of transitional arrangements set up as a result of a previous demerger. It also included the devolvement and integration of a joint venture the acquirer had in the market which had to be completed four weeks after the acquisition completed.
Some of the key issues the client faced were:
- How to identify and validate potential revenue and cost synergies pre-signing.
- How to realise both cost and revenue synergies in a business that had already undergone two extensive cost reduction programmes resulting in staff and management feeling a sense of “change fatigue”.
- How to take control of the acquired business in the critical first month without doing harm to the core business in very challenging market conditions and how to protect the existing value within the business.
What We Did
- We supported the client pre-completion to help ensure Day one readiness and commence integration pre-planning. A number of workstreams were set up in this phase including a Value Creation team focusing on further developing assumptions in the synergy case; a Day one team responsible for managing the activities required for deal completion; a team dealing with Day one communication requirements; and an HR team focusing on developing a change management plan for post completion and supporting interim organisational design.
- We worked with the client to help them to develop the integration strategy and approach and then, in a matter of days, resourced and launched a joint integration team with representation from both businesses across all functional areas.
- Following completion, we continued to manage the Integration Management Office (IMO) and grew its team to support the detailed integration planning and benefits tracking in the functional areas of the business.
- The majority of our time was spent working with combined acquirer and target teams to help them to develop jointly agreed detailed integration plans that confirmed the pre-deal synergies and took account of the change issues prevalent in any integration.
- We worked closely with the client’s integration team to help them to ensure that integration issues, interdependencies and decisions were flagged early and resolved quickly to maintain the momentum of the integration.
- During the integration planning period we worked with the finance team to help them develop a robust benefits tracking approach and framework which the client team continued to use to track and report progress against synergy targets.
KPMG in the UK
020 7311 4190