M&A - Be Prepared

One of the aspects of a return to stability in the banking sector is the availability of financing for M&A activity. Treasurers at the ACT Annual Conference are expecting growth in M&A from the low years of 2008 and the first half of 2009. All well and good - but what does this mean for the day job?

In simple terms, treasurers in companies looking at M&A opportunities should always have an outline of how to raise funding tucked away in an office drawer. The range and complexity of financing techniques from equity rights issues to bond issuance will need detailed planning and careful execution, so it's perhaps never too soon to keep abreast of the markets.

Of course the actual transaction is only one part of the job! Treasurers will need to be involved in due diligence, planning for treasury integration, ensuring equity and debt providers - in their own and the target company - are kept informed and, last but not least, remembering to pay the bill!

Treasurers on the receiving end of M&A will also be under pressure to add value to a defence or to be professional in any takeover or merger in assisting due diligence and managing their own stakeholders. Perhaps like the Scouts, this is one area where treasurers should adopt the motto of 'Be Prepared'.

By Peter Matza