Mergers and Acquisitions Trends

Most people see M&A as a straight line: LOI → Diligence → Close → Integrate. That’s not how deals actually work. Deal success comes from managing three interconnected levers. A concept I learned from Carlos Cesta,  and they’re in a constant feedback loop: 1️⃣ Deal Structure: How you pay and align incentives (cash, equity, earnouts, escrows). Defines who holds risk, how much control you have, and post-close alignment. 2️⃣ Due Diligence: What you uncover and your ability to validate it. Findings shift your comfort level with price, structure, and integration speed. 3️⃣ Integration Strategy: Your blueprint for combining people, go-to-market, and systems. The speed, depth, and sequencing directly impact value capture. Here’s the kicker: Change one lever and the other two have to adjust. Example – shaky revenue forecast?  ➡ Move to a contingent earnout (structure)  ➡ Slow down or phase integration (strategy) Buyer-led M&A™ is about running this loop intentionally: testing assumptions, making trade-offs, and keeping all three levers in sync to engineer success. Don’t manage M&A like a checklist. Manage it like a system.

Everyone loves to talk about the strategy behind M&A deals. But the thing I’ve learned watching FMCG leaders up close? Deals don’t fail because of bad strategy. They fail because of people. It’s never the financial model that breaks first — it’s leadership misalignment. I see it happen all the time in FMCG — especially in Private Equity backed environments. The model looks perfect on paper: → Acquire a few fast-growing brands → Roll them into a global portfolio → Drive efficiencies, cost synergies, market expansion But then the integration starts — and suddenly things look very different. Because what the spreadsheet doesn’t tell you is: → The founder isn’t used to quarterly board meetings with EBITDA pressure → The CMO is still running a startup playbook in a scaled organization → The CEO doesn’t align with the go-to-market model in a new geography → The commercial leaders can’t navigate two different company cultures merging overnight And this happens more than most will admit. In fact — Bain & Company data shows 70% of M&A deals underperform expectations. And culture is one of the top 3 reasons. In the FMCG space — where brands carry legacy pride and deeply embedded ways of working — leadership integration is no longer “important.” It’s non-negotiable. Great M&A outcomes today don’t just come from smart strategy. They come from: → Leadership teams that trust each other faster than the market moves → Leaders who can flex between entrepreneurial scrappiness and corporate discipline → People who know when to protect brand identity — and when to evolve it And here’s what I tell my clients: If leadership alignment is not your #1 risk mitigation strategy in M&A — you’re not just betting on growth. You’re betting on luck. The smartest investors I work with in FMCG? They’ve learned this the hard way. They’re doing culture diligence as seriously as financial diligence. They’re assessing leadership “integration readiness” before the deal closes. They’re hiring talent not just for operational excellence — but for the ability to navigate ambiguity, pressure, and transformation. Because the future of FMCG M&A won’t be won by the best strategy. It will be won by the best people. Drop me a message — I’m always up for a conversation on building high performing teams. #FMCG #ExecutiveSearch #PrivateEquity #MergersAndAcquisitions #Leadership #CultureIntegration #ConsumerGoods #HiringStrategy

"Let's integrate everything first." "Connect all systems." "API-driven transformation." That's what I hear constantly. Not from successful implementations... from projects that fail spectacularly. → A client spent $2M integrating their broken order management process across 5 systems. Result? They automated chaos. Faster errors. Bigger mess. Here's what actually happened last quarter: So here's the reality: I don't start with integration. I start with fixing what's broken. Because connecting inefficient processes just scales the inefficiency. What failed projects do: • Connect systems without questioning workflows • Automate before standardizing • Integrate first, optimize never What my successful implementations do: • We fixed the process, then connected it • Standardized workflows before any API work • Questioned every step before automating anything Integration amplifies whatever you feed it. Feed it garbage processes, get garbage faster.

One of the challenges for a person involved in a #mergersandacquisitions transaction is that they often do not have an end-to-end understanding of the process. This limitation partly stems from the individual not possessing all the skill sets needed to comprehend a complete M&A deal. Another factor is the secretive nature of M&A deals, which means people are typically involved for a specific purpose and, consequently, are not exposed to all facets of the deal. I have been fortunate in that I have been running deals from end to end for the last few years. This experience has provided me with a detailed understanding of every stage of the process, from strategy to valuation, accounting, integration, and legal considerations. In addition, as many founders, private equity (PE) professionals, venture capitalists (VC), and CXOs approach me for advice in M&A engagements, I get exposed to various industries, sectors, and the contextual nuances of each deal. One crucial aspect I would like to address in this post is how accounting practices vary depending on the stake controlled in the target company. M&A is typically a control approach, where the buyer acquires more than 50% of the target. In such cases, the buyer must combine the seller's financials while conducting purchase price allocation. If the buyer owns more than 80% of the target, this consolidation significantly affects tax reporting. 𝐂𝐨𝐧𝐬𝐢𝐝𝐞𝐫 𝐭𝐡𝐞 𝐟𝐨𝐥𝐥𝐨𝐰𝐢𝐧𝐠 𝐞𝐱𝐚𝐦𝐩𝐥𝐞: When a buyer acquires 80% of a seller, it records the entire value of the seller on its balance sheet. This includes any excess purchase price as goodwill. The 20% of the seller that the buyer does not own is recorded as a separate item, known as noncontrolling interest. This process ensures that the financial statements accurately reflect the total value and earnings of both companies combined. Consolidation involves eliminating intercompany transactions and balances. This comprehensive approach ensures that the buyer's financial statements accurately reflect its expanded asset base and liabilities, incorporating the seller's entire operations, not just the proportion the buyer owns.

Recently, I’ve been asked by several of my colleagues regarding the the structuring of the sale of AskBio Inc. to Bayer. Maintaining separate operating independence and control over therapeutic development after selling a biotechnology company requires proactive, legally binding structural mechanisms negotiated before the deal closes. The goal is to separate the economic ownership from the operational governance. The wholly owned operating subsidiary is the gold standard for maintaining independence. Instead of "absorbing" your company into their existing structure, the buyer keeps your company as a standalone legal entity. Key aspects are: 1. Maintain your own Profit & Loss statement. If you control your own budget and bank accounts, you retain the power to hire, fire, and invest. As we were not yet generating revenue, we negotiated a funding commitment for a period of years, where cash would be injected into the company to support product development. 2. Keep Distinct Branding and Culture: Contractually agree that the buyer will not rebrand the entity or force the adoption of their corporate HR/culture policies for a set number of years. 3. Implement "Arm's Length" Agreement: Ensure that any services the parent company provides (legal, accounting, IT) are governed by a services agreement so they cannot dictate how you operate under the guise of "integration." 4. Maintain Independent Board of Directors: Negotiate a Board for your subsidiary that includes representative from the company and the buyer, and possibly a neutral third party. 5. Create Reserved Matters List: Create a list of items that the parent company cannot vote on without your consent, such as: Changes to the R&D roadmap, discontinuation of products in development, clinical trial design and site selection, and key personnel appointments. 6. Negotiate Performance-Linked Budgets: Ensure that as long as you hit certain milestones, your funding is contractually protected and cannot be diverted to other corporate projects. 7. Require high legal standard for CRE (commercially reasonable effort efforts). If the buyer fails to put enough resources behind a drug in development, they are in breach of contract. 8. Consider a "Buy-Back" Option: Negotiate a right to buy the company or therapeutic back at a pre-set price (or for the cost of development) if the buyer decides to pivot away from your core therapeutic area. (Hard to get). Please include in comments any other suggestions. It took me three exits to figure out this list. Maybe next time I’ll get it exactly right! #biotech #companysale #therapeuticdevelopment #operatingindependence #exit #drugdevelopment #biotechnology

NewPrinces Group takes over Carrefour Italy – vertical integration meets market consolidation NewPrinces Group, the Anglo-Italian food multinational chaired by Angelo Mastrolia is acquiring 100% of Carrefour Italia—including its real estate (Carrefour Property), finance (Carrefour Finance), and operating arms (GS S.p.A.)—for an enterprise value of approx. €1 billion (€600M business, €400M real estate). Carrefour Italia operates 1,027 stores (642 directly managed, 385 franchised), with around €4 billion in revenue and €115 million EBITDA. Carrefour exits the Italian market following years of losses. This marks another step in Carrefour’s multi-year retrenchment strategy: • China (sold to Suning in 2019) • Taiwan (stake sold in 2022) • Colombia (sold to Cencosud S.A. in 2012) • South Korea (2006), Mexico (2005), Malaysia (2012), Switzerland (2007), Argentina (sale under consideration mid-2025) Meanwhile, NewPrinces continues its rapid consolidation path in the food sector. Originating from the Parmalat Group in 2004 (as Newlat Group SA), it has executed multiple acquisitions over the last two decades: • Buitoni (Nestlé 2008) • Delverde (Molinos Rio de la Plata, 2019) • Centrale del Latte d'Italia S.p.A. (2020) • Princes Group (UK, 2024) • Diageo Operations Italy (2025) • Plasmon Italia (Kraft Heinz, July 2025) In 2024, the group generated €2.778 billion in revenue and €142.3 million net income. Q1 2025 showed strong growth: €672.7 million revenue, €54.8 million adjusted EBITDA (+30.5% YoY), and €13.5 million net profit (vs. a €2.3 million loss in Q1 2024). According to Mastrolia, the Carrefour acquisition is a strategic leap toward vertical integration—combining manufacturing and distribution to unlock value across the entire supply chain. A long-term move to relaunch one of Italy’s most extensive retail networks. #retail #fmcg #foodindustry #grocery #mergersandacquisitions #distribution #supplychain #omnichannel #growthstrategy #ecommerce #supermarkets #privateequity #consumerbrands #sales #investments #retailtech #foodtech #strategicgrowth #storemanagement #franchising #carrefour #newprinces #italy #europe #multinational #leadership #industrynews #businessmodel #sustainablegrowth #restructuring #corporatedevelopment

M&A “String of Pearls” strategy Using Merck's Deal to break the jargon As a markets person, I had not heard of this term until last week, but it’s a very simple idea. Instead of making one huge, high-risk acquisition, a company collects a series of smaller, targeted deals over time. Each one adds a specific capability, product, or technology. Individually, they may not transform the company but together they reshape its future. Last week’s $9.2 billion Merck-Cidara deal is a textbook example. With Keytruda, a >$20 billion a year cancer drug losing patent protection in 2028, Merck isn’t searching for one single replacement. It’s building a necklace: ↳ Acceleron ($11.5bn) pulmonary hypertension ↳ Verona Pharma ($10bn) COPD (Chronic Obstructive Pulmonary Disease) ↳ Cidara ($9.2bn) long-acting flu protection (CD388) ↳ Plus heavy internal R&D investment Each deal adds a 𝘱𝘦𝘢𝘳𝘭 that extends Merck’s pipeline, smooths the revenue cliff, and spreads scientific and commercial risk across multiple assets and therapeutic areas. That’s the power of the strategy: ↳ Diversification without dilution ↳ Multiple shots on goal instead of one ↳ A more predictable growth path into the next decade The phrase may sound technical, but it’s simply good portfolio management, applied to M&A.

Starting my career in the corp finance and M&A industry during the first solar consolidation wave, I've watched buy-and-build strategies evolve across my entire journey. Thrasio raised billions to roll up Amazon brands, then went bankrupt. Some DTC aggregators tore up investor money like it was confetti. But some roll-up strategies create massive value. Constellation Software Inc. owns 1,000 profitable niche companies. Berkshire Hathaway turned their strategy into an ultimate cash-to-wealth compounding machine. What makes the successful ones work? From my observations, we can reduce the space to four archetypes. Three work under specific conditions. One is financial suicide. 1// The classic PE exit play works when you have liquid markets and can actually capture synergies. 2// The infinite cashflow compounder works when you buy only profitable, sticky businesses. 3// The thematic consolidator works when you're reshaping entire sectors with 10+ year vision and distribution advantage. 4// The anti-hero archetype: Buying cashflow-negative companies in competitive markets hoping "synergies" will magically appear. This is what killed the DTC aggregator wave. The brutal truth to roll-ups financed by venture capital is that predictable cashflows beat everything. Customer switching costs create real moats. And when everyone chases the same roll-up strategy in a sector, competition destroys margins faster than you can capture them. In construction: Can specialized trades with maintenance contracts work? (like HVAC) Can material distributors with loyal craftsmen networks work? (Brad Jacobs thinks so) General contractors dependent on project cycles? (Usually financial quicksand) Comment below: Which archetype have you seen work (or fail) in your sector? #rollups #construction #cashflow #acquisitions

Navigating Acquisitions: Key Considerations for Software #Startups 🚀💼 Thinking about selling your software #startup? The decision to pursue a merger or acquisition (M&A) is a pivotal moment that requires careful planning and strategic alignment. Based on insights from Volaris Group's The Ultimate Guide to Selling Your Software Company (2025), here are key factors startups should consider when approaching an acquisition: (1) Merger vs. Acquisition: Decide whether a merger (integrating with a complementary business) or an acquisition (operating standalone or absorbed) aligns with your goals. For instance, mergers suit smaller startups seeking access to larger customer bases, while acquisitions are ideal for market leaders with strong brand recognition. (2) Customer Impact: Choose an acquirer committed to maintaining your product and service quality. Ask: Will they invest in your software, or force customers to migrate? Will support remain consistent? Prioritizing customer trust ensures your legacy endures. (3) Employee Development: A great acquirer invests in your team’s growth. Look for buyers with a culture of collaboration, clear talent management strategies, and opportunities for professional development to secure your employees’ future. (4) Strategic Fit and Values: Align with an acquirer whose values and growth strategies match yours. Investigate their track record—do they foster long-term growth through R&D investment, or focus on short-term gains? A shared vision is critical for success. (5) Avoid Common Pitfalls: Don’t wait too long to sell, as market conditions can shift. Ensure transparency during due diligence and prioritize deal structure over price alone—earnouts and contingencies can impact your outcome. (6) Prepare Thoroughly: Build a strong M&A team (CEO, CFO, CTO, legal counsel) and create a comprehensive Information Memorandum to showcase your company’s value. Address technical debt and refine your growth story to boost valuation.

The first edition of McKinsey & Company’s M&A Quarterly Update by Jake Henry and Mieke Van Oostende arrives at a pivotal time for dealmakers. Despite continued geopolitical uncertainty, the market has carried forward the momentum we saw in the second half of 2025. Global M&A activity reached ~$1.35T in Q1 2026, up 37% year over year, with technology-led deals continuing to reshape the landscape. • Mega-deals are back in force, accounting for more than 42% of total deal value globally. • The Americas remained the center of activity, driven largely by AI-related transactions. • TMT continued to dominate, representing roughly one-third of global M&A value. • Corporate acquirers, not just sponsors, are driving momentum as companies position for long-term competitive advantage. This resilience isn't fueled by volume alone. Average deal size reached multi-year highs, suggesting that leaders are willing to make bold, strategic bets even in a volatile environment. Read more on the latest M&A Quarterly insights: https://lnkd.in/ef6pbAuh