Effective communication during mergers and acquisitions (M&A) is crucial due to the fast-paced and rumor-prone nature of these events. In October, a masterclass was held to address the complexities of M&A communications, focusing on the importance of strategic planning to prevent misinterpretations and maintain clarity.
M&A Communications Planning
M&A communications require meticulous planning as mergers are often fast-breaking stories that can easily lead to rumors and misinformation. The environment is tense, and messages can be misinterpreted or exaggerated, necessitating careful communication strategies.
The Event Focus
In 2016, two major mergers highlighted the challenges of M&A communications:
- Ball Corporation merged with Rexam, becoming the largest manufacturer of beverage cans globally.
- AB InBev merged with SAB Miller, creating the world’s first truly global brewer.
The Rexam and Ball Corporation merger resulted in a £5bn deal, while the SAB Miller and AB InBev merger was a £105bn transaction, the largest in UK history. Industry experts Mark Bunker, Duncan Gordon, and Justine Stevenson shared insights on navigating these complex communications challenges.
Key Learnings
Understanding the M&A process and potential timelines is essential. The process typically includes:
- Approach and offer
- Board agreement and offer acceptance
- Regulatory pre-conditions and potential divestments
- Convergence planning with a focus on day one and the first 100 days
- Shareholder vote
- Change of control
- Integration and synergy realization
Managing a diverse group of stakeholders is crucial, including employees, company leadership, the board, the takeover panel, internal deal teams, lawyers, bankers, media, HR, employee representative bodies, and global communications functions.
External and Internal Communication Strategy
Aligning external and internal communications is vital. Key considerations include:
- Reacting quickly to external factors
- Aligning communications with the merger roadmap
- Focusing on business continuity and prioritizing employees
- Maintaining performance and managing uncertainty through strong employee engagement
- Establishing internal communication infrastructure to minimize risk and disruption
- Supporting leaders to navigate uncertainty and maintain performance
- Assessing company cultures and avoiding assumptions about similarities
- Listening to employees and deploying the right communication channels
Gloria Lombardi emphasizes the importance of a two-way communication process, allowing employees to voice concerns and ask questions without fear, despite potential resistance from leaders.
Key Challenges
- Maintaining productivity during a merger is challenging, but effective communication can reduce disengagement.
- Attracting and retaining talent is difficult, especially with platforms like Glassdoor amplifying challenges.
- Being open to rumors is crucial, as misinformation can harm stakeholders and competitors.
If you are interested in speaking at or attending future events, please contact us at marketing@vmagroup.com. For discussions on the issues raised, please contact Sara Tehrani. Connect with us on LinkedIn.
