Communication Strategies for Merger Integration

By Tom Taulli

Communication is the hallmark for any good relationship ñ including business relationships like M&A. When an M&A transaction is announced, it is natural for employees to be scarred. Will they still have their job? Will they be demoted? Will they have lower pay and fewer benefits? These are all the natural
questions employees will ask themselves.

So, before making the M&A announcement, it is absolutely critical to have a communications plan in place. The following are some tips:

Strategies....

? The CEOs of both companies should present the strategic reasons and benefits of the transaction.

? As early as possible, communicate to each employee whether they will be kept on board for the long-term. Present a letter that clearly explains the compensation, benefits, retention bonus and severance. If practical, it is a good idea to have face-to-face communication.

? For those who are staying on board, you can have a welcome package. Basically, it is as if you are hiring the person, such as by providing a welcome letter from the CEO, press releases of the transaction, fact sheet about the acquiring company, annual report, hiring paperwork, employee handbook and so on.

? Communication must be continuous. For example, you can provide a weekly newsletter to update everyone on the progress. There can also be periodic meetings.

? Provide a means for easy feedback. And be responsive to any questions. If not, rumors will inevitably spread.

? Finally, honesty is the best policy. If you donít have an answer, do not make one up.

MergerPlace is pleased to have the esteemed Mr. Tom Taulli as the managing editor of our MergerPlace M & A Advisor™ E-zine.

Tom Taulli is an expert in the M&A process. He is the author of the critically acclaimed The Complete M&A Handbook (Random House) as well as six other books written for publishers such as Bloomberg and McGraw-Hill. Tom also teaches M&A at the USC School of Business.

Tom has been quoted extensively in the press, including the Wall Street Journal, USA Today, Barron's, and The Los Angeles Times, and has provided commentary on CNBC, CNN, and Bloomberg TV, as well as appeared on a variety of top radio stations across the country.

Tom's books are available for purchase in our bookstore.

BACK to Tom Taulli archive