Wiesbaden, July 23, 2021. An M&A process brings many unanswered questions, difficulties and challenges. To keep key stakeholders informed and clarify their concerns in a timely manner, you should plan plenty of time for good communication.

by Georg Grießmann

Successful post-merger integration and communication requires a lot of time, tact and transparent information. With the following five pieces of advice, you can master this process and satisfy stakeholders more easily.

1. Communication before the deal is closed

A post-merger integration project does not start on day 1 after the closing. A planned company acquisition is often known internally and externally before the closing, usually when the contract is signed, which may be several days or weeks before the closing. For publicly traded companies involved in an M&A transaction, the signing of the contract may require an ad-hoc disclosure. But even for non-listed companies, the previous owners should announce and explain the change in ownership structure to the workforce.

In both constellations, the new owner is not yet the “king of the castle,” but it is nevertheless important for the new owner to send messages to the employees now that will prepare the ground for a successful integration project: What do I value about the acquired company? What prospects do I see for this company? What does this mean for the employees?

2. Show face, proximity and personal accessibility

The most important communication goal of the new owners must be to secure the trust, loyalty and commitment of the employees of the acquired company. Uncertainty, mistrust and doubt can, in the worst case, lead to a slow but steady exodus of employees. If this is perceptible externally, the churn can lead to reticence on the customer side and to difficulties in attracting new employees.

A representative of the new owners should therefore be on site at the headquarters of the acquired company at a very early stage, at the latest a few days after the closing, in order to introduce himself to the workforce, explain the joint path to the future and build trust in a successful collaboration. In this way, open questions can be answered immediately and at first hand. A regular presence on site and the establishment of good contact with bodies such as the works council, union representatives, important customers and suppliers, local political players and representatives of the local media are ultimately the key to ensuring that other important stakeholders are not ignored in post-merger communications.

3. Show face, proximity and personal accessibility

Key questions from the workforce about the future of the acquired company and job security are predictable. They therefore allow good communicative preparation and generally arise immediately after the takeover plans become known. The new owners should therefore deliver these important messages as early as possible, for example at the next work meetings or in the first information mailing to the workforce.

Questions about aspects such as the distribution of tasks and competencies between the group companies, the integration of the new company into the group-wide strategy process, joint market cultivation or the coordination of joint R&D and production processes only arise after weeks or months. In order to inform employees about the future course of joint work and to promote smooth cooperation, the owners should communicate at regular intervals on progress in the integration projects of the various departments and business units.

4. Take advantage of the variety of communication channels available

In order to create trust and an interpersonal basis for successful joint work, the personal meeting remains the most important communication format. Work meetings, workshops and one-on-one discussions should take place many times during the first phase of a post-merger integration project.

The more locations a company or group of companies operates, the more difficult it is for the new owner to offer all employees a face-to-face meeting. In such situations, use the broadcast of townhall meetings via video conference on the intranet or the recording of video statements. In addition, use analog communication tools such as notices or employee magazines to reach colleagues in departments that do not have regular access to PCs and digital content such as mailings, postings or intranet pages.

5. Honesty lasts the longest

Corporate mergers can also involve unpleasant issues such as the closure of plants, business units or departments and associated job cuts. Among stakeholders, such steps usually lead to vehement rejection – often accompanied by a negative media response, pressure from politicians and trade unions, and a “shitstorm” in social media.

For new owners who want to implement such measures, the following applies: Remain steady and credible in your communication despite fierce headwinds. Speak regularly, clearly and honestly about the critical issues and upcoming measures. Address stakeholders’ questions. Take their concerns seriously and treat them with respect. Don’t make promises you can’t keep just to avoid an ultimately inevitable conflict in the short term. In the long run, it is more important not to damage your credibility by communicating honestly, transparently, seriously and fairly with the affected stakeholders.

cometis has gained a lot of experience with M&A transactions. We are happy to support your company in successful communication that satisfies all its stakeholders. For more information, please click here.

Georg Grießmann: Senior Consultant
Georg Grießmann worked for many years in the controlling department of an international IT services company. The focus of his work was the preparation of financial reports, key figure analyses and the preparation of management reports.