Even for experienced deal makers, a first digital acquisition is bound to be an education. Companies acquire to accelerate their overall strategy and digital transformation, as Publicis Groupe did when it acquired Sapient for $3.7 billion in 2014 to help it make the leap from a traditional advertising company to a digital one. But when companies turn to mergers and acquisitions (M&A) to help them deal with digital disruption, they usually discover not only how different a beast digital M&A is compared with traditional M&A, but also that everything they thought they knew about M&A may actually not help. They’re also likely to be paying an even higher premium for the acquisition, betting on a fast—although uncertain—development.
3 Ways M&A Is Different When You’re Acquiring a Digital Company
There are new challenges with financing, due diligence, and integration.
July 11, 2017
Summary.
Digital mergers and acquisitions are a different beast compared to traditional M&As — so much so that even experienced dealmakers may need to take a new approach. Specifically, digital M&As require refocusing around three key issues: financing, due diligence, and merger integration.