Acquisition Integration2022-06-13T14:07:36-04:00

ACQUISITION INTEGRATION

Supporting your organization through the transaction

The failure to successfully integrate two organizations after a transaction can greatly erode the expected value generated by the acquisition.

M&A leaders recognize the accelerated pace of today’s transactions often requires working alongside advisors who bring the necessary experience, financial expertise, and operational agility to help them realize their desired strategy and maximize the intended transaction value.

Successful deal execution incorporates the value drivers underpinning a deal in every stage of the M&A process, from diligence to integration, to Purchase and to divestiture. When targeting inorganic growth, change can often be unpredictable and uncontrolled. To be additive to this process, advisors must quickly develop a deep-seated knowledge of a client’s business, understand the value creation thesis, as well as possess the relevant cross functional expertise.

Leading companies hire us to:

Confirm their deal strategy and identify risks to deal value drivers
MorganFranklin helps firms evaluate if they are ready for a deal as well as better inform them about how the transaction will impact their business in the short, medium, and long term.

Confirm deal value or address accounting and compliance valuation requirements
We deliver a full range of valuation services and provide accounting for business combinations in accordance with FASB Accounting Standards Codification (“ASC”) 805, Business Combinations.

Have experienced professionals manage the transaction process and initiate Day 1 planning
Our team will work to assess the complexity of the integration, stand up the Integration Management Office (IMO), and work with stakeholders to define the target operating model.

Flawlessly execute their deal strategy and realize the value of the transaction
We lead teams as they execute post-LD1 processes, stabilize operations, get through first quarter reporting, and successfully close post-LD1 milestones.

Manage the change ​

Every acquisition needs a tailored integration strategy – but in every integration, Change Management and Effective Communication are at the core.

Our Methodology

Achieving acquisition goals in today’s market requires sharp focus on finding the right deal and having sufficient information to negotiate a fair price, all while concurrently implementing an optimized integration strategy.

MorganFranklin has identified 6 common practices that highly successful organizations are able to leverage when performing an acquisition integration.

  1. Create a shared vision of the future operating model – Misunderstanding the end state creates confusion and results in delays. Defining the end state operating model for each function provides organizations with clarity and direction when developing and executing an integration.
  2. Assign executive champions and align incentives – Limited executive accountability is a leading cause of value-loss during an integration. Defining the executive(s) responsible for the integration and building the successful outcome into their performance goals drives alignment and accountability.
  3. Emphasize value preservation and synergy realization – Organizations often expect benefits immediately after the transaction has been closed but fail to integrate value preservation and synergy realization into their planning effort. Successful organizations understand the points where value creation occurs and prioritize this in the planning process.
  4. Understand key drivers of integration complexity – Underestimating the complexity and risks associated with an integration can skew planning efforts, resulting in continuous adjustments and pivots to the plan. Assessing and understanding the drivers of complexity and risks posing a danger to the integration leads to the development of a successful plan and approach.
  5. Complete integration planning prior to the deal closing – Many organizations focus their energy on closing a deal instead of on detailed planning for post-deal operation and integration. Predeal planning puts management in a proactive position to start the key activities that will meet the timeframe to realize the value of the merged firm.
  6. Cultural integration drives employee retention – Organizations run the risk of integration burn-out, which creates retention issues with top performers. Cultural integration is vital to successful acquisition integration. Organizations that experience the best results emphasize change management, spot awards, and workload management.

Our Comprehensive Services

MorganFranklin offers a comprehensive set of services to organizations that are growing through acquisition. Our teams use proven methodologies and tools to assist clients in realizing near-term and long-term deal value while working to enable business continuity and Day 1 operational success.

Acquisition Strategy

  • Transaction structuring
  • Synergy identification and qualification
  • Corporate development execution support
  • Strategic planning development
  • Integration planning, road mapping & execution
  • Strategic network design and development

Integration Management Office

  • IMO development and mobilization
  • Acquisition integration playbook development
  • Enterprise-wide IMO management & execution
  • Change Management
  • Day 1 – Day 100+ workplan
  • Post close KPI & synergy tracking & reporting

Valuation

  • Model expected performance of a division
  • Advise on the valuation of an acquisition or sale
  • Appraise intellectual property assets
  • Determine fair value of tangible and intangible
  • Financial and regulatory reporting
  • Model potential operational and tax synergies

Operating Model Development

  • Develop target state operating model
  • Operating model blueprint development
  • Defining interim operating guidelines
  • Identify opportunities to outsource, insource and co-source
  • Integrated supply chain planning

Due Diligence

  • Diligence Management Office (DMO)
  • IT integration diligence and cost analysis
  • Cyber risk assessment and mitigation planning
  • Financial due diligence
  • Operational due diligence
  • Integrated demand planning diligence

Information Technology

  • Applications, data, infrastructure & architecture integration
  • Integration readiness platform rationalization
  • Blueprint IT application combination design
  • Future state cyber security analysis & planning
  • Day 1 end user cutover support

Combination Accounting

  • Business vs. asset analysis and definition
  • Acquirer identification
  • Measurement period process quantification
  • Combination determination and assessment
  • Disclosure and reporting

Functional Integration

  • Close & consolidations integration
  • Benefits analysis and combination
  • IT operations combination execution
  • Field & Sales office conversion
  • Reconfiguration of supply chain network
  • Manufacturing and distribution optimization

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