© Copyright Acquisition International 2025 - All Rights Reserved.

Article Image - Creating Collaborative Business Outcomes: Why Tech and Finance Leaders Should Unite During the M&A Process
Posted 8th April 2025

Creating Collaborative Business Outcomes: Why Tech and Finance Leaders Should Unite During the M&A Process

In any competitive marketplace there are lots of drivers for companies to merge and acquire each other. Sometimes it’s about expanding market reach by tapping into markets that a competitor has better footings in, or it could be about being better positioned to succeed against bigger competitors.

Mouse Scroll AnimationScroll to keep reading

Let us help promote your business to a wider following.

Creating Collaborative Business Outcomes: Why Tech and Finance Leaders Should Unite During the M&A Process
Chessboard with chess pieces and wooden blocks with the word mergers and acquisitions

By David Tyler, Founder and Director of Outlier Technology

In any competitive marketplace there are lots of drivers for companies to merge and acquire each other. Sometimes it’s about expanding market reach by tapping into markets that a competitor has better footings in, or it could be about being better positioned to succeed against bigger competitors. 

The benefits are very often easy to explain, from cost savings and removing duplicate teams, processes or capabilities to driving economies of scale associated with higher production rates. 

But the stakes are high and none of these benefits are guaranteed. All businesses are unique – even franchises and chains – because of the people, the customers, geography, laws, timing and all manner of other constraints, meaning the process of merging businesses is not at all straightforward. 

It’s easy to get caught in the trap of believing that if two companies work in closely related fields, use technology from the same vendors and follow the same legal requirements for accounting and financial practices, that merging their operations should be straight forward. Unfortunately, nothing could be further from the truth. 

M&A teams will be formed on both sides, and external advisors will be brought in to help with the process, but very often people’s eyes are firmly fixed on the commercial prize – the upside, the potential, the excitement. 

Integrating processes and systems is very often given a back seat in the process. It’s something that rears its head after the deal is done, and that’s where the uncomfortable truths start to appear: those systems from the same vendor have been configured completely differently by both companies, and the processes they support are totally incompatible.  At this point, the costs of integration can easily skyrocket because we’re no longer talking about reconfiguring some systems or tweaking some processes, we’re talking about complete and fundamental change to how one or both organisations operate. And that was never part of the acquisition plan! 

This sounds almost too absurd to be true, but it happens more often than many would like to admit.  Technical and operational due diligence are some of the easiest cans to kick down the road, but the impact of getting it wrong can be massive. The level of risk being ignored can be huge and it can mean the difference between being able to recognise those commercial benefits or not. 

That’s exactly what happened following a $10 billion deal which saw Goldcorp Inc acquired by Newmont Mining Corp. The newly formed Newmont Corporation became one of the world’s largest gold producers. But SAP Insights reports that the acquisition was soon beset with problems, including multiple duplicate and different IT systems that somehow had to be combined, as well as varying cybersecurity policies which increased exposure to risk for the new company. 

An early tech focus 

What if things were different? What if the M&A processes brought technology leaders to the table at the earliest opportunity, to work in partnership with the rest of the deal team? 

This would enable them to undertake a thorough assessment of the existing technology resources across both companies, including all of the policies and processes, the hardware and software used by both, and the skills of the people within each department.  While it takes more time, it’s time well spent. 

In many cases these are some of the biggest transactions companies will ever do – far bigger than any individual client deal or property purchase, so using tools like targeted PoCs to identify fundamental issues with compatibility of systems as early in the deal as possible will pay dividends. 

Being able to assess the work involved in creating unified cyber security policies, training plans for staff who will need to use new technology, how to rationalise and consolidate cloud and on-premise technologies – these are all critically important to successful integration. 

Ultimately it’s about being realistic, honest and responsible about what is achievable and what the costs are likely to be.  And those assessments need to be given the weight and importance they deserve in the deal making process. 

It’s a concept supported by the BCS, the Chartered Institute for IT, which states: “In order for the merger to be a success, IT leadership needs to be involved earlier in the M&A journey to better equip organisations in realising success earlier and at a lower cost.” 

When tech becomes a stumbling block 

We don’t have to look very far to find examples of M&A deals falling apart quite dramatically.  And it’s not just about financial penalties – there can be serious regulatory, reputational and even political impact when things go wrong.  

When Banco Sabadell bought TSB, customer bank records were moved on to a new system – a project costing £450 million which was expected to save £160 million a year. But the process was rushed and the technical due diligence was largely skipped. The result was customers locked out of their online accounts for days unable to pay their bills, not to mention being able to see other customers’ accounts. These issues cost TSB Chief Executive Paul Pester his job and added more than £176 million in costs to the acquisition deal in compensation, lost income and additional resources (Raconteur). 

Sprint hoped their $35 billion majority stake acquisition of Nextel Communications would help them become the third largest telecommunications provider in the US at the time.  The upside was clear – gaining access to each other’s customer bases would see both companies grow exponentially. However, the two companies had no overlaps in terms of the technology – their networks were fundamentally incompatible, making it incredibly difficult to merge operations and resulting in a huge market share loss (M&A Science).  

But it’s not always like that.  One example where technology teams had been consulted early in the process was the proposed acquisition of the Williams & Glyn bank branch network by Santander. The technology teams found that ‘unpicking the existing technology’ was simply too complex, and the whole deal was halted (Raconteur). Whilst it was no doubt a blow to those who’d spent time and money on investigating the feasibility of the deal, it would ultimately have much more costly had they not stopped the process at that point and proceeded without realising the tech issues they were facing.  

This is a rare case of technical and operational experts being given the time, understanding and priority to make an honest assessment – this assessment revealed the problems involved which put a stop to a potentially disastrous deal. 

How to avoid the pitfalls 

While the process may not be simple, the concept of mitigating risks surrounding merging technologies is straightforward enough.  But to mitigate or accept a risk, you have to know it exists and then understand it: this is what due diligence is for. We’re more than comfortable performing financial due diligence, so adding technical due diligence shouldn’t be an alien concept. 

Technical leaders need to be given time and resources to identify risks and consolidation opportunities and, once you have the results of their investigations coming back, they need to be taken seriously.  

History has shown us time after time, once the deal has been signed and the process of merging the two companies, or assimilating one company into the other, has begun, it’s too late to highlight any red flags which may have stopped the M&A process had they been discovered before the ink on the contract dried. 

David Tyler

Categories: Finance, M&A, News, Technology


You Might Also Like
Read Full PostRead - Eye Icon
Doing Business Overseas
Finance
05/05/2016Doing Business Overseas

Landing Dione is a Consultant, who specialises in real estate management and strategies, quality management, value chain management, project management and business development.

Read Full PostRead - Eye Icon
Four Communications Moves into Retail Sector with Acquisition of Rain Communications
Finance
26/07/2016Four Communications Moves into Retail Sector with Acquisition of Rain Communications

: Independent integrated agency Four Communications Group (Four) today announced the acquisition of Rain Communications (Rain) in a move that sees the business extend into the retail, destination and luxury sectors. Rain, which was formed over a decade ago, bi

Read Full PostRead - Eye Icon
Over a Third of International Employers Do Not Offer Enough Health and Wellbeing Benefits and This Impacts Their Recruitment and Retention
News
12/03/2025Over a Third of International Employers Do Not Offer Enough Health and Wellbeing Benefits and This Impacts Their Recruitment and Retention

In research issued by Towergate Employee Benefits, over a third (37%) of companies with employees based outside of the UK stated that they do not offer enough health and wellbeing support and that this impacts their ability to recruit and retain people.

Read Full PostRead - Eye Icon
Extraordinary Achievements
Finance
23/10/2018Extraordinary Achievements

Drawing on more than an aggregated 100 years of local investment experience in the Brazilian market, Prudent Group, through its innovative Prudent Investment Fund (PIF), offers investors a unique opportunity to move into this dynamic market. Having recently be

Read Full PostRead - Eye Icon
Top places to find skilled specialists for your startup: React developers for hire
News
18/04/2023Top places to find skilled specialists for your startup: React developers for hire

You’ve just decided to hire React developer talent for your cutting-edge project. You’re brimming with excitement, but there’s a problem: where do you find these elusive experts to make your vision a reality? Fret not, fearless leader, for we

Read Full PostRead - Eye Icon
Privet Capital Acquisition of Aeroment from Black Diamond
Finance
04/08/2015Privet Capital Acquisition of Aeroment from Black Diamond

Privet Capital Acquisition of Aeroment from Black Diamond

Read Full PostRead - Eye Icon
Employees: This Is How Tax Fraud Affects your Background Check in 2021
Finance
04/06/2021Employees: This Is How Tax Fraud Affects your Background Check in 2021

Paying taxes and filing returns is an important civic responsibility. While some employers may fail to make a background check on tax fraud, you wouldn't want to be on the wrong side of the law. Tax fraud occurs when you knowingly forge information on tax retu

Read Full PostRead - Eye Icon
Building a Successful Upskilling Strategy
Strategy
21/12/2020Building a Successful Upskilling Strategy

How can businesses better support L&D in their organisations and build effective upskilling strategies to remain competitive?

Read Full PostRead - Eye Icon
Technology M&A – Shifting Paradigms
Innovation
15/07/2016Technology M&A – Shifting Paradigms

M&A in the technology, media and entertainment (TME) space has boomed over the last 24 months and while Brexit may dent confidence and activity, arguably this sector is better placed than most to remain buoyant.



Our Trusted Brands

Acquisition International is a flagship brand of AI Global Media. AI Global Media is a B2B enterprise and are committed to creating engaging content allowing businesses to market their services to a larger global audience. We have a number of unique brands, each of which serves a specific industry or region. Each brand covers the latest news in its sector and publishes a digital magazine and newsletter which is read by a global audience.

Arrow