How to manage risks and increase value in a merger

by | Oct 19, 2022 | Technology

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Global mergers and acquisitions (M&A) reached a record $5.1 trillion in 2021, and with economic headwinds leaving acquisition as the only viable exit for many startups, further market consolidation is inevitable. As recent M&A transactions like Amazon/One Medical and JetBlue/Spirit Airlines continue to make headlines, security, IT and business leaders should be prepared for the technical challenges of integrating the digital assets of companies seeking to combine their operations. 

From reviewing the acquiree’s financial records to scrutinizing its product roadmaps, companies assessing an acquisition target must identify business opportunities while accounting for a multitude of cybersecurity risks. During this effort, the acquiring organization needs to review the other company’s data and systems to determine how — and sometimes whether — to merge IT and security operations. This isn’t easy, given the variety of technologies, data locations, and processes in modern organizations.

As IT environments continue to grow more complex, M&A transactions are becoming increasingly technically challenging. There are a few crucial things to keep in mind that will increase the strength of a post-merger security program.

Start with the business needs 

Security professionals tend to evaluate M&A from a purely technical standpoint. Understandably, we worry about inheriting vulnerable or, worse yet, compromised IT assets and weak security practices. We also think about integrating the acquired company’s security and IT technologies into the acquirer’s program and security frameworks.

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This is a reasonable starting point. Yet, focusing solely on technological aspects of the M&A transaction can lead to missing the opportunity to offer additional value to the organization. …

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