Study: Merger and Acquisition Deals Moving Online
BY Erik Sherman
If selling your company is a possible exit strategy, go where more M&A deals are happening--on the Web.
An entrepreneur always keeps an eye out for the next opportunity--even when it comes to serendipitous exit strategies. When that exit strategy is a merger or acquisition, it helps to be in the right place at the right time for the right deal.
Maybe that's a certain coffee shop or the basketball court with the right types on Thursday nights at the local Y. But according to an online global survey that content management and collaboration software vendor Intralinks took of 2,400 M&A pros, you'd better get yourself online in the right places, as well.
Not terribly shocking that anyone in business is doing work online, but it helps to know how seriously they use it as a tool. In the case of M&A, the use is pretty heavy.
About 27.2 percent of sell side personnel and 44.8 percent of buy side "participate in online deal sourcing." Almost half of buy-side professionals get more than a quarter of their deals from networks; 39 percent of sell-side have marketed more than five deals on networks during the past year. More than 85 percent of sell-side pros have marketed at least one deal online sometime during the last 12 months.
More than half of buy-side and 40 percent of sell-side people have closed a deal initially found on an online network. Almost 70 percent say that networks make deal sourcing more efficient and close to 40 percent want more innovation in marketing deals.
Of particular interest is the mix of applications these people "use daily" in their M&A work and what they expect to use in two years (graph from Intralinks):
A caveat to the results: Intralinks is in the collaboration space and has a product called DealNexus that provides a members-only network and deal sourcing tools. That said, if the company could find that many M&A people who use online platforms to this degree, it would be shortsighted to dismiss the study out of hand.