Breaking the news about an acquisition can be a rather fraught aspect of the M&A process, particularly as this kind of deal requires significant levels of confidentiality. In fact, as an acquirer, you will be bound from the offset by an NDA that prohibits you from spreading news of the transaction to anyone that’s not directly involved.
This is because, if your target’s suppliers and customers get wind of the prospective change of ownership too soon, they may decide to jump ship, which would have a serious impact on the company’s operations and profitability.
So, with so much discretion required right from the get-go, and so many potential risks that can come from speaking out at the wrong time or in the wrong way, how do you go about revealing that you’re making an acquisition?
Fortunately for you, we’ve compiled some top tips and insider insights that will help you make the right choices about when, where and how you make the big reveal.
1. Planning makes perfect
Planning a detailed communication strategy – both internal and external – is crucial to prevent any mishaps. It’s crucial that everyone involved is carefully briefed on when and how they can discuss the proposed acquisition; a transaction which, it’s important to remember, may not even go ahead. M&A activity, after all, often fails for a variety of reasons before anyone’s even had the chance to sign on the final dotted line.
As a result, you need to time the breaking of your big news very strategically.
To help you get things right, create meticulous timelines for the internal and external distribution of information. Appoint specific people to break the news, both to those ‘on the inside’ and to the wider world. Come up with a consistent and well-thought-out message to share and try and predict any potentially difficult questions that could be asked – whether internally or externally.
While it probably sounds like a lot of work for just one relatively small part of the acquisition process, we really can’t stress enough how important it is to communicate things correctly. Investing in careful and considerate planning and preparation can prove invaluable and save you a lot of potential stress and difficulty that can be easily avoided.
2. Telling the team
Due to the stringent confidentiality surrounding acquisitions, the first people you will be breaking the news to are going to be those directly affected – the staff. The public unveiling will come much later (if the deal does go ahead).
First, you need to come up with a tactful and considerate means of communicating news of the deal to your prospective employees. Of course, most of the talking will be done by the seller, who already has a robust relationship with them and who will be responsible for maintaining their morale and addressing any concerns they may have. However, it’s also important for your company’s leaders to engage in positive communication, introducing yourselves to the team and helping to reassure them that they won’t come off worse by remaining on the payroll throughout the sale and beyond.
As M&A deals unfold, staff sometimes decide to resign when they get wind of a change of ownership, often out of fear that they won’t be treated as well by the new leadership or perhaps even laid off somewhere down the line.
As this employee turnover is a situation that is best avoided, it’s vital that you break the news at the right time and in a sensitive and empathetic way, responding to queries or fears your new team have in a manner that imparts confidence and consideration.
By doing so, you will help to ensure that your new employees stick around for the long haul and keep your new business on track during the transition and beyond.
3. Breaking the news to your customers
Due to the stringent confidentiality surrounding acquisitions, the first people you will be breaking the news to are going to be those directly affected – the staff. The public unveiling will come much later (if the deal does go ahead).
First, you need to come up with a tactful and considerate means of communicating news of the deal to your prospective employees. Of course, most of the talking will be done by the seller, who already has a robust relationship with them and who will be responsible for maintaining their morale and addressing any concerns they may have. However, it’s also important for your company’s leaders to engage in positive communication, introducing yourselves to the team and helping to reassure them that they won’t come off worse by remaining on the payroll throughout the sale and beyond.
As M&A deals unfold, staff sometimes decide to resign when they get wind of a change of ownership, often out of fear that they won’t be treated as well by the new leadership or perhaps even laid off somewhere down the line.
As this employee turnover is a situation that is best avoided, it’s vital that you break the news at the right time and in a sensitive and empathetic way, responding to queries or fears your new team have in a manner that imparts confidence and consideration.
By doing so, you will help to ensure that your new employees stick around for the long haul and keep your new business on track during the transition and beyond.
4. Going public
Once your acquisition has proceeded to a point where it’s clear that the deal is going to go ahead, both you and the seller can prepare your public announcements. The way you do this depends on your preferences – you could create a detailed press packet featuring a wealth of information about your two businesses, your leadership teams, and your goals for the future.
Alternatively, you might just want to collaborate on a press release to be distributed to the relevant outlets. This press release should contain a brief overview of your businesses, how the acquisition will affect everyone involved, what the benefits are and when the deal should be finalised.
Hire a business broker to help
An acquisition is a complicated transaction which carries a sometimes-daunting level of risk. What’s more, it involves jumping through some serious legal and financial hoops, while simultaneously trying to keep all the people involved on the same page.
To make the whole process more straightforward and a lot less intimidating, why not hire a business broker to help you through it? As well as helping you with every stage of the acquisition, from valuation and negotiations to due diligence, they can also offer invaluable guidance – including regarding when and how you communicate the news.
Stress-free acquisitions with Harris Acquire
Keen to embark on an acquisition that brings you optimal value with minimal stress? Our experienced and trustworthy team here at Harris Acquire can help you achieve just that.
What’s more, we offer an exclusive Acquisition Finder service, which includes a 30-day money-back guarantee for your total peace of mind.
If you’d like to find out more about this service, and how we can help you make your acquisition goals a reality, give us a call on 01926 757100 or send a query to Hello@harrisacquire.com and we’ll be more than happy to answer any questions.
