M&A Technical Due Diligence

Mitigate risk and maximize the success of your M&A

IT can make or break your deal

One of the top three reasons that M&A’s fail is problems with integrating systems. You can prevent these technology snags and accelerate value by conducting technical due diligence early in the M&A. If you’re currently acquiring or merging with another business, now is the time to pay attention to IT. Software and IT infrastructure will play a huge role in the success of your integration, and impact the value you’ll realize down the line.

Beating the odds of failure requires a technical due diligence consultant—someone who can objectively assess systems on both sides of the table. Our M&A technology due diligence experts will help you mitigate critical risks while delivering a plan to maximize success from Day 1 forward.

So before you deliver the final handshake, let’s equip you with the facts you need to protect your M&A’s value.

technology m&a due diligence

Why is technical due diligence for M&A so critical?

Your technology IS your business

It’s bold but it’s true: In today’s digital world, technology is central to any company’s core value. So if your M&A due diligence process that focuses only on finance, legal, and operations, you’re missing a key piece of the pie. 

Synergy is key

You know when you really want things to work out, so you don’t even look for the red flags? Technology due diligence is key step to supporting a sustainable union, confirming the value assumptions you had going into the M&A and ensuring that synergies flourish as planned!

Value rises with no surprises

Hidden IT costs that inflate operations. Unforeseen investments down the road. These are some of the not-fun surprises that result from a meager assessment. That’s why you need a partner who will dig deep, leaving no technical stone unturned.

M&A is risky business

There are always risks in an M&A. Understanding those risks can save you. Evaluating not just the strengths, but the weaknesses of your software and IT will determine how (or if!) you proceed, inform your mitigation strategy, and provide critical inputs for the valuation.

What you get from a technical due diligence assessment

The results of a M&A technical due diligence engagement extend far beyond a list of integration risks. We strive to paint you a clear picture of what Day 1 will look like and create a comprehensive post-merger integration plan. Here some of the key things we deliver:

  • Technical due diligence findings report
  • Risk profile report: Processes and systems
  • Remediation report: Processes and systems
  • Fit-gap report: Skills and staffing
  • Future state recommendations
  • Post-merger integration roadmap: Processes, systems, people

During our recent M&A deal, Headspring proved the value of their ongoing partnership by acting quickly to assess the applications on both sides of the deal and develop a migration plan. With Headspring taking the lead, we were able to migrate data and transition to the go-forward solution in a record time. Just seven months from signing, USAC reported to investors that we were working from a single set of systems. It was a proud moment to be in IT.

Julie Bullerman

VP, Information Technology, USA Compression

Our four-step approach to technical due diligence

Our M&A technology due diligence process is high-touch and comprehensive. We not only evaluate the technology, we get to know your goals, teams, and processes so we can devise tailored and foolproof recommendations. While every engagement is unique, we’ve broken down our approach into four detailed phases, so you can get a high-level idea of what to expect:

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IT value is largely determined by the people who use it. That’s why we take the time to talk to stakeholders on both the product and business sides. This helps us understand your goals, account for current or planned IT initiatives, and assess whatever roadmap you may have going in.

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Technical due diligence involves more than just tech. Our comprehensive review covers development processes, deployment pipelines, architecture, security vulnerabilities, code, infrastructure, system duplication, portfolio activities, and third-party/open source components.

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Data-driven by nature, we measure every factor that may impact your M&A. These include organizational readiness and flight risks, viability of competing systems (what to integrate vs. retire), risks in tribal knowledge, and the skills/talent needed to support development and maintenance.

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Armed with the facts, we help you identify the best platforms in your portfolio and decide what to do with your apps (Rearchitect? Upgrade? Build or buy something new?). Our high-level recommendations include an integration plan and a vision for the future state of your architecture.

Stories from the field

We’ve guided many clients through the M&A process. We understand the risks and unknowns—and how to mitigate those by involving iT. That’s why we strive to help others understand how much technical due diligence for M&A can impact the overall success of a deal, as well as your long term ability to grow. Here’s a deeper look at how we help our partners succeed:

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Migrating systems during an M&A doubles business capacity

A swift, successful data migration empowers this national equipment provider to exponentially expand their fleet.

Why IT needs to be involved early in the M&A process

One of the top 3 reasons M&A fails is technology integration issues. Bringing IT to the table early can up your chances of success.

M&A technical due diligence

Conducting the technical due diligence to drive a solid deal

Assessing the target company’s system and business delivers insights to guide an investment firm’s decision and strategy.