M&A Best Practices

Effective Synergies Framework

Juan P Pulido
Most M&A transactions start with a deal rationale
that gets decomposed
Deal Deal specific rationale
aligned with corporate
Strategic Rationale strategy

A combination of common
Integration Integration Integration cross deal objectives, and
Objective Objective Objective some deal specifics

Specific projects / initiatives

Initiatives Initiatives Initiatives Initiatives that could be grouped in
themes (value, process, org)

Functional Integration Project Plan

Functional Functional Functional
Project plans with milestones
Milestones Milestones Milestones and tasks that enable all the
above levels and are actions
Functional Functional Functional driving the integration
Milestones Milestones Milestones
… and a financial framework derived from it

Deal
Strategic Rationale

Integration Integration Integration

Objective Objective Objective Revenue
Synergies
+

Cost
Initiatives Initiatives Initiatives Initiatives Synergies
+

Enabling
Expenses
-
Functional Integration Project Plan
Functional Functional Functional
Milestones Milestones Milestones
Integration
Costs
-
Functional Functional Functional
Milestones Milestones Milestones ________________
Transaction’s P&L
The configuration complexity varies with the desired level of
details to be tracked

Deal
Strategic Rationale

Integration Integration Integration

The deeper the functional and Revenue
Functional

Objective Objective Objective

Synergies
+
financial tracking, the more
demanding the configuration getsCost
Initiatives Initiatives Initiatives Initiatives Synergies
+

Enabling
Expenses
-
Functional Integration Project Plan
Functional Functional Functional
Milestones Milestones Milestones
Financial Integration
Costs
-
Functional Functional Functional
Milestones Milestones Milestones ________________
Transaction’s P&L
 A B C
Initiatives with High level metrics Detailed Financials
KPIs linked to milestones linked to Milestones

Detailed decomposing of
High level tracking of
Approach synergies with hierarchies
deal’s goals / synergies
and financial details

Synergies data configured

Framework Leverages the Value
in Tasks and potentially
Configuration Drivers module
anchored through VD

Outside application Detailed Financial

Financial
(attached Excel or other Schedule built for each
Tracking
linked systems) underlying synergy driver

Detailed reporting /
Standard set of reports
Reporting multiple home-pages for
for synergies data only
deals and portfolio views
Reserved for serial
Most clients either track
acquirers with significant
Adoption synergies at this level or
M&A maturity or a
below
“shooting star deal”