The future of Mergers and Acquisitions - Digitization for M&A processes
The future of M&A
Assuming the highest possible degree of automation and integration of the tools, the following can be assumed: Routine activities will be largely fully automated, decision tasks will be partially automated, negotiations will be supported by digital assistants.
Effects of automation
Let us look at exemplary effects of this scenario for the approach in due diligence. Routine tasks such as data room review and reading of large numbers of documents will be eliminated by using natural language processing and forensic tools. Missing information is automatically requested based on consistency checks of the data room contents. The time and effort spent on this will be dramatically reduced. Problems that today can only be detected after a time-consuming, manual review of the data rooms are automatically determined and displayed as soon as the data room is available. In other words, these issues will be available on day one instead of weeks later.
Remaining questions regarding the content of the data room are answered with the help of chat bots. The contents of due diligence meetings between buyer and target companies are also automatically logged and matched by digital assistants with the contents of the data room and the information received in the meeting, as well as e-mails and other information, are automatically added to the due diligence knowledge base.
Benefits of merger automation
There may be many other effects of automation that are not listed here. This future scenario would have the following benefits: The quality of the due diligence results will increase because the due diligence information is fully captured and does not depend on human resources. The risks and problems available at the beginning of the due diligence phase due to automation can be analyzed and mitigated earlier and more thoroughly. This can be used to increase the quality of results or to significantly shorten the due diligence process.
This short example has given us a first insight into the expected, far-reaching effects of automating the due diligence process. Whether and how quickly we will arrive in this future is up to all of us. The human factor will still be decisive, but in a different form. Let us proceed optimistically.
The future of M&A interview
I have talked about this in an interview with Kison Patel, that you can view below.
The future of M&A
A new approach to merger automation is needed
This is why we need a new, radical approach to digitization of M&A processes. This approach is described in detail in my new book. For more information and free previews, sign up here: (we respect data privacy and will not spam you. You will get M&A- and book-related content)
Here is some interesting literature on the topic:
