Remote M&A Integration: Combining from Afar

Remote M&A Integration: Combining from Afar 

A smooth M&A integration is always challenging, and can be even more so in a remote environment. When two companies merge, it can be a disruptive time, but there are strategies and technology solutions that can help create a smooth transition for all parties.

• We’ve identified the following factors — thorough planning, well-defined reorganization, and robust communication  — as both more important and potentially more challenging in a remote integration. 
• Harnessing technology will go a long way in shrinking the gap between new team members, helping your company execute from afar. 
• Data rooms are a ‌powerful tool to help an integration go smoothly and keep all team members on the same page.

“If you fail to plan, you are planning to fail." 

As a favorite corporate adage, you likely knew the second half of the phrase before reading it. There is no better time to apply this wisdom than when faced with the complex task of remotely completing an M&A deal. While our comfort with remote solutions makes this an easier task than before, technology only works if we use it to its full potential.

Some key things to nail down early: 

Build a shared vision for the new company.

Why did this M&A deal happen? What M&A synergies are both companies hoping to enjoy, and how can they be achieved? What reservations or expected challenges do executives foresee, and how can they be addressed? Providing decisive answers to these questions will empower the entire company. 

Set up an integration team. 

Also called an IMO (Integration Management Office), having a team dedicated to carrying out a smooth merger will maximize your chance of success. This team can either be internal or external, and should provide expertise and accountability to the integration’s planning and execution.

Build and come back to your KPIs.

Develop key performance indicators and milestones to lay out for the future, and to measure against throughout the process. 

Create a new organization chart so that everyone understands the new leadership and support structure. 

Building a new organization chart is an important step in conveying the combined company’s new leadership and accountability structure. 

Incorporate the best technology into your integration. 

When planning your remote integration, you should lean into the best technology available to make the process easier. Virtual data rooms should be up and running with permissions assigned from day one. Plan how to employ video conferencing, collaborative software, and other tools to make remote work more manageable, and educate all team members on how to use them. 

Establishing these technologies early, and training the entire organization on how to use them, will avoid wasting resources on piecemeal adoption and education. 

Building a New Culture 

It should come as no surprise that one of the most frequent and vexing challenges following a merger is properly identifying a new chain of command and a shared vision for the company and its future. 

Having a strong culture means knowing who the leader is, where each person fits into the group, and how we’re moving toward an exciting future together. 

After you sit down and intentionally build a new operational hierarchy, it is critical to ensure every person in the company understands the new structure or can easily reference it. It pays to connect people with problem solvers, for issues ranging from IT to accounting, to either replace or adapt the legacy staff support system to the new organization. 

There should also be a sense of shared purpose, a strong understanding among all team members of why this merger took place and how the new organization will unlock the most value for stakeholders, employees, and the clients you serve. Make your vision clear, and incorporate feedback from the entire organization. Create a welcoming space for frequent, fearless feedback. Listen carefully to feedback and find ways to move the day-to-day reality toward the company’s vision. 

Remote work can often make building a shared culture more of a challenge. However, it can still be achieved through frequent, purpose-driven meetings, less formal meet-and-greets, and shared activities online or in person. Getting creative and leveraging new technologies is crucial here. 

Podcasts and newsletters can help team members stay updated on the culture you’re building. Teams can also pursue virtual town halls and less informal online opportunities, such as casual chatting on Slack, helping employees get to know one another in a casual, organic way they’re used to.  

Communication: More Important than Ever 

M&A is really about connecting two previously distinct groups. Connection requires communication, and lots of it. In a physical workplace, this communication includes body language, the proverbial chat by the water cooler, and the ability to bend the ear of a colleague after a chance encounter. These organic moments are a wealth of information between team members, and that means intentional effort is required to make up for them in a remote integration. 

Technology will save the day here. Two years into the remote work revolution, there are more solutions to connect team members than ever before. Video conferencing, productivity, collaborative tools, and frequent meetings across the formality spectrum will help people feel involved, heard, and supported.

Data Rooms: A Key Factor for Successful Integration 

One positive impact on M&A in the post-COVID era: people are using virtual data rooms like never before. They’ve proven to be the indispensable way to avoid remote integration's security, legal, and logistical challenges. Many CEOs are finding them to make deals easier than they were pre-pandemic. 

Legal processes and audits, both crucial and susceptible components of integration, require access to swaths of sensitive data, which often must later be revoked. VDRs make this once-vexing process more streamlined and secure. Today, we have the ability to assign and revoke access to documents for as many or as few people as necessary.

Beyond the merger, VDRs enable seamless management of any sensitive intellectual property. Employees avoid sifting through months-old emails for an attached document, in favor of having one centralized place to access their shared documents. 

In a recent interview with Financier Worldwide, Duncan Reid, a partner at Weightmans LLP, said that the pandemic has actually helped to reduce friction and increase security by moving document sharing online. 

“As most parties and advisers to a transaction are working remotely, more due diligence is being completed virtually in data rooms. This assists the integration process, as following completion the information is readily available in an electronic format.”

Indeed, properly managing the access, transfer, and storage of company documents may be the best predictor of a successful remote merger. Major consulting firms and financial outlets call it not only an essential component of a successful M&A, but a powerful efficiency driver that makes it a better time than ever to pursue integration. 

Data rooms go far in addressing the three pain points discussed (planning, organizational cohesion, communication): 

• They facilitate planning by quickly allocating access to documents, and providing a quarantined space for them to be stored and shared. 
• They help solidify the organizational structure by assigning permissions and facilitating document approvals, and provide all team members with centralized access to company-wide documents. 
• They improve communication in newly combined companies by enabling all pertinent team members to access the same information. 

Get in touch today to find out how virtual data rooms can empower a successful, smooth integration.