How Much Do Various Advisers Affect the Success of M&A?

By: Alexander Schmitz & Soenke Sievers (CLS Blue Sky Blog)

Companies that engage in M&A regularly employ a variety of financial, legal, and other advisers to enhance the chances of success for a deal. Though research has extensively examined the impact of financial advisers, and particularly investment bankers, on a deal’s outcome, the influence of strategy advisers such as management consulting firms (and legal advisers) has rarely been studied. Overall, based on a global questionnaire of over 100 M&A professionals, we find that strategy consultants contribute significantly to the perceived M&A success of firms.

Dataset

Between December 19, 2019 and February 28, 2020, companies worldwide were surveyed regarding their M&A activity and M&A success. Specifically, the survey asked what type of advisers were hired to support surveyed firm’s M&A transactions, and how frequently they were employed. The survey also asked whether the respective advisers were hired only sometimes, such as when transactions were perceived as particularly complex, always, or never?

Our detailed questionnaire also addressed key company characteristics that influence the employment of advisers. These include, for example, how many in-house M&A experts work permanently at the company and how the company’s own M&A activities are organized internally (e.g., own M&A department at the headquarters, multiple departments, or experts at the business unit level). Finally, survey participant demographics, such as the age, the position within the organization, and their own M&A experience were taken into account when calculating the effects…

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