Merrill DataSite provides due diligence platforms for financial transactions worldwide, and as such is a leading indicator of trends and future trends across global deal markets. However, no one needs us to tell them that M&A markets are currently bullish; there’s no doubt about it. There has been a flurry of activity over recent months, and dealmakers in private equity, corporate development teams and investment banks are poised to hit the ground running as soon as an opportunity presents itself.
From the latest Mergermarket M&A Insider reports sponsored by Merrill DataSite, we know global deal value was up 27% year on year from May 2014 to May 2015, whereas deal volume was down 30.9% – proving competition for assets is growing fierce.
One major issue related to this is that there is simply too much cash – both dry powder and on corporate balance sheets – chasing deals, which is raising competition to new heights, increasing some valuations to pre-financial crisis levels.
Numerous new funds have closed in recent months, surpassing their targets, including Silverfleet, Inflexion, Carlyle, Equistone and Bridgepoint. Added to that, debt is cheap, so when an acquisition situation comes along individuals want and need to be ready to move fast.
Law firms and M&A lawyers know better than anyone the demands this can place on every layer of their organisation – from Partner to Associate. Everyone understands that when serving the client, delivering what they want (and fast) is paramount, because delivery engenders trust and trust engenders repeat business. It is gaining trust, building long-term relationships, and establishing a successful team that really forms the basis of good M&A deal-making, ultimately making the difference in a competitive situation.
When relationships are established, generate success, and work for mutual benefit, why change them?
This philosophy has been a long standing tenet of Merrill DataSite’s. We support expediting due diligence processes for our clients – old and new. Yes, we do that through technology, but largely we achieve this through the human element in our part of the transaction. Our Project Managers work 24 hours a day, seven days a week in dedicated teams to ensure there is always someone available and ready to answer the phone, to open the project, or to load documentation onto the due diligence platform. This builds trust with our clients that we can deliver, and that’s the differentiator.
You have to deliver quality, of course, but you have to deliver it fast. It’s a universal truth when talking to professionals in M&A that there are time pressures. Time-squeeze is a fact of life, and processes that clients may previously have built a six month contingency for are now being demanded within two months or less.
Clients want to complete a transaction or make decisions quickly in order to capitalise on the opportunities they are being presented with and to gain the winning edge. If they can seal the deal quicker than anyone else, establish a relationship with the seller and gain their trust, then it is less likely that the process will drag on or go to auction. For example: one large, global sponsor recently completed an acquisition after they told the target company that they could finish the process in five days.
The law firms under the pressure of these ever compressed timelines advise buyers that due diligence processes have to be done as fast as possible, which means using a supporting cast of experts who can simplify the process. This is done by auto-enabling every document placed in a virtual data room so it becomes fully searchable within seconds, information can be found quickly and easily, smoothing the process, with project managers ready in the wings if needed.
If an M&A client can steer their deal towards a swift conclusion, saving time and money in the process, they will be happy. If they can keep out the competition and prevent their asset from going to auction, that is all to the good. If they can invest their capital and have that generating profit, rather than languishing, waiting to be put to good use, all the better. And, if trusted partners and advisors can help speed this process and expedite getting them what they want, then that means long-term relationships and future success.
Merrill DataSite is established as the market-leader for virtual data rooms (VDRs) in Europe and across the world. As first to market, we have many years of experience to bring to your transaction and have had time to develop and refine our technology, leading to a peerless Project Management and systems infrastructure that operates 24/7/365. This is why many thousands of companies trust Merrill DataSite to manage their online due diligence processes.