Post Merger & Acquisition

DealTrack post merger and acquisition

Posted by Andrew Butt on May 11, 2017 08:34:00

We are witnessing a huge volume of Merger and Aquisition activity. A great deal is written about the operational, organisational and process challenges post merger or acquisition by Bain, McKinsey, PWC, KPMG, Ernst Young  and other M&A consultancies who assist businesses with best practice for Integration Management Offices (IMOs).

This blog introduces a paper we have written that is focused on just one of the issues that IMOs have to deal with: ERP integration post-merger. 

In the document, we talk about a new way for IT to view systems integration post merger that, in some cases, can provide a faster route to post merger value.

First, though, it should be said that for those companies in the pharmaceutical sector who are merging to create a powerful R&D team, or those in transport wishing to open up their horizons, the need for integration in its widest form and in particular the integration of people and cultures could be top priority. 

This paper is not for them.

We focus entirely on those businesses for whom commercial strength (both in terms of better buying power and better selling) is at the heart of the merger.  

Good examples include those in the wholesale distribution industry, building materials, food retail and others that sell or distribute finished goods. 

For them, the driver for merger or acquisition is most often focused on improving buying power, and in order that the merger is considered successful, the IMO should prioritise the realisation of this potential improved buying power. 

In doing so, buying requirements need to be consolidated, and to achieve that, many business look to consolidate their business systems.

We outline a proven solution that minimises any disruption to existing IT systems and purchasing processes. 

This is a new platform, fed by existing ERP systems that gives commercial teams all the tools and information they need in order to realise the value targets set by the merger.

It is neither a data warehouse, nor a new breed of ERP, but an entirely new solution that helps businesses manage the key areas of

  • Pricing management
  • Procurement contracts
  • Supplier management
  • Rebate management

…across multiple ERP systems.

And let's not forget the suppliers in all of this.  A supplier dealing with a larger organisation rather than several smaller ones sees benefit in economies of scale too. This forging of mutual commercial targets between supplier and buyer is often realised in the form of rebates, and this is where DealTrack excels.

If you are a post-merger business, looking to gain commercial advantage through enhanced buying power,  and you typically engage with suppliers by constructing deals that include complex rebates or retrospective discounts, our paper “Realising M&A synergies faster” represents a MUST READ for you.

Realising M&A Synergies Faster

Topics: Mergers & Aquisitions