M&A processes are exceptional in business. Those who have been running a company for a long time know that it is a powerful enough tool to elevate their company to the next level.
Some people oppose big M&A deals, saying they’re a pointless waste of money with an obvious overpayment for ownership. Either way, we just can’t get past it and see examples of M&A data rooms firsthand.
How Does VDR Help in M&A?
In fact, data room software really helps a lot in the M&A process, at least for the reason that they make it easier to automate documents in due diligence. It saves time and adds extra security features many times over. After you have tried advanced technology once, you can no longer work in the traditional way.
Advanced Security Against Leaks with VDRs
The integrity and security of your data must be a top priority regardless of whether you are a start-up with a seed round of funding or a publicly traded global corporation. We frequently hear about high-profile security failures that lead to data leaks, which may be disastrous for secret M&A initiatives.
On actual servers that are housed in extremely secure data centers, data room services are implemented. The danger of data breaches is minimized through regular penetration testing, warning mechanisms, and regulated access. You should always make a data room comparison to ensure maximum future safety performance.
The Greatest Takeovers and Mergers in the World
Most of the biggest deals in the last 20 years have been quite profitable, if we take examples from this list. Many of them actually achieved their goals and rebuilt what was needed. Now you will see the very same 9 companies that have distinguished themselves quite a bit with their big deals.
AOL and Time Warner
The infamous merger of AOL and Time Warner in 2000 is a case in point of what we meant when we said at the beginning of this post that “large doesn’t necessarily imply better.” The transaction has solidified as the standard example of how not to carry out mergers and acquisitions in a little more than two decades with the help of a virtual data room.
Verizon and Vodafone
The transaction, in which Vodafone had taken part in two, was the third biggest in history at the time. From Verizon’s standpoint, it gave the corporation complete control over its wireless operation, ending a lengthy and sometimes contentious partnership with Vodafone. It also allowed Verizon to create new mobile networks and compete in the era’s highly competitive market.
Dow Chemical and DuPont
Everyone sat up and took notice when Dow Chemical and DuPont announced their merger in 2015; the merger of equals would produce the largest chemicals firm in the world by sales and end rivalry between them, making it a textbook example of a horizontal merger with electronic data room.
It didn’t last long: In 2019, management announced that the merged business will split up into three new organizations, each with a different purpose. Shortly after the acquisition was finalized in 2018, the company was already producing $86B in annual sales.
United Technologies and Raytheon
Given that the agreement between United Technologies and Raytheon concluded in the first half of 2020, its long-term effects have not yet been realized. United Technologies at the time used a fairly advanced consumer VDR to get the paperwork together as quickly as possible. They were able to do it in the shortest time possible.
Now that the purchase is finalized, Raytheon will be able to take advantage of United Technology’ experience with high-temperature materials for jet engines and its possession of the necessary generation and energy management technologies for directed energy weapons. And all this became available only with the help of each individual example of all virtual data rooms.
AT&T and Time Warner
Antitrust authorities criticized the proposed M&A firm of AT&T and Time Warner when it was first revealed, and it also brought up memories of the last time Time Warner had been a part of a megadeal.
With nearly two decades to learn from its error and AT&T being a far larger revenue producer than AOL, this acquisition appears to have been more carefully considered than the one that came before it. Given the advanced technology inside AT&T, they have their own online data room software development, which, by the way, is not unlike the consumer versions. With this, it was easy to prepare the documents.
AB InBev and SABMiller
The only issue was that they failed to anticipate the growth of craft beers and how it would upend the brewing sector. After a number of add-on purchases of craft breweries, the new business could finally be back on track. You might be surprised at how quickly this transaction went through with data room vendors.
Glaxo Wellcome and SmithKline Beecham
The firm is presently the sixth largest in the world and the only one from the UK to rank in the top 10. It was formed in 2000 by the merging of two of the biggest pharmaceutical corporations in the UK.
Its market value is currently around 25% less than it was at the time of the merger, similar to several of the other acquisitions on this list that have not been warmly welcomed by investors.
Heinz and Kraft
The stock price has dropped by billions since the closing of the agreement, which has been dubbed a “mega-merger.” Allegations regarding the two firms’ pre-merger accounting procedures were one of the causes. This is a relatively modern transaction that was done successfully with the help of the best virtual data room providers.
Zero-budgeting (ZBB), a rigid cost-cutting regime that was implemented at a time when the old brands needed to be rejuvenated rather than having their budgets reduced, was another factor.
Bristol-Myers Squibb and Celgene
Despite the scale of the transaction, Celgene became a division of Bristol-Myers Squibb in this 2019 megadeal, which wasn’t a “merger of equals.” Two of the biggest producers of cancer drugs in the world are joining forces in this agreement, so ideally the whole will be bigger than the parts. We know for a fact that they had to compare virtual data rooms to find the best option. And they succeeded.