The heavy reliance on information technology (IT) for business operations, management information and financial reporting in today’s business environment makes IT a priority item in M&A. Not only does IT often count among the largest capital and operational expenditure items, the owners of a business must also find better ways of deriving value and leverage from IT assets.
- Purchasers need confidence that the IT assets supporting the business are up to the task.
- Purchasers to have a clear view of any IT investment required to maintain the EBIT of the business being purchased and factor these costs into their calculations and negotiations.
- Vendors need to secure the best possible sale price. Identifying and then mitigating or addressing IT issues with transaction relevance reduces purchaser risk which supports a grater sale price.
- Vendors and purchasers both need to minimise the impact of the sale and transition process on business operations.
If this is your situation
- You are an equity buyer targeting a business with the intention of creating incremental value by improving business performance.
- You are a trade buyer looking to strengthen your company’s core business by acquiring a rival or complementary products.
- Your company strategy involves disposing of part or all of a business, whether through a carve-out of business units, or by the sale of existing entities.
- You are seeking to gain synergies or economies of scale by combining businesses or business units.
How PwC can help
- By providing buyers with insightful understanding of the cost and impact of system related issues that are relevant to the transaction being considered.
- By identifying opportunities to improve business performance through enhanced IT enablement and cost reduction.
- By providing purchasers with options and strategies for managing the IT related aspects of a transaction to avoid disruption to business operations and reduce risk
- By identifying IT systems options (and the capital required) for achieving post deal strategies that are being considered during a transaction.
- By providing purchasers with greater certainty that the IT systems supporting the target business are fit for purpose and identifying resources critical to continued business as usual operations.
