Buying another business is fraught with pitfalls. There are practical considerations, like integrating IT systems and standardising processes, but the bigger challenges are often cultural.
This starts on day one, and often goes to the very top. The vendors of a business might be very happy to trouser the cash (assuming any actual money changes hands) but, if they stay on with the business – either permanently or during an earn-out – tensions can bubble up.
Long before differences occur between the vendor and their new “boss” about running the acquired business, sensitivities can arise to do with perception, and the way a transaction is framed. Fundamentally, nobody likes to appear to have been “bought”.
This creates challenges for the PR representatives of organisations that want to promote their latest acquisitions.
To put it bluntly, a press release with the headline, “Acme Corporation snaps up Beta Corporation” will usually get more coverage than “Acme Corporation makes strategic investment in Beta Corporation”.
Admit it, you know which one you would read.
A sensitive subject
However, these press statements tend to be issued at times of maximum sensitivity, when staff who will be transferring across are feeling vulnerable and the vendors can become a little paranoid about how their existing clients/customers/competitors will react to the news.
The temptation, therefore, is often to obfuscate, and to issue a press release that can be summed up as, “Nothing is changing except that now we have more money.”
Aside from being at best a half-truth, this is not a particularly exciting angle for a story in the media.
The challenge, therefore, is to balance the need to tell a compelling – and accurate – story with the sensitivities of vendors, staff and customers.
Setting the tone
The key, often, is not to sound triumphal, and for the purchaser to emphasise the positive benefits that the acquisition will bring to its organisation. Any benefits to customers – both of the purchaser and vendor – should also be highlighted.
As with all media relations, it is a question of giving the media enough of what they want for them to cover your story, while also making sure the messages you want to convey come through loud and clear.
Deal/M&A stories involving privately-owned firms are bread and butter for the business media but, for media relations specialists, they are anything but simple. This is a subject to which I will return in future blogs, highlighting some of the more common pitfalls and suggesting potential angles of approach.