The Merrill Corporation survey highlights future challenges for EMEA dealmakers when complying with regulations, accelerating deals and harnessing the power of data.
An increasing number of M&A transactions may be stalling because of concerns over GDPR compliance, according to a survey of EMEA M&A professionals conducted by Merrill Corporation, the leading SaaS provider for professionals in the deal making community.
Overall, the survey highlights the significant role due diligence plays in determining M&A success, while providing insight into the challenges faced by M&A professionals today. The implementation of the EU’s General Data Protection Regulation (GDPR) stood out as a major hurdle for mergers and acquisitions, with more than half of respondents (55 per cent) citing the compliance and data protection employed by the target company as a primary reason a transaction did not progress. Additionally, 66 per cent of those surveyed believe that GDPR will increase acquirers’ scrutiny of the data protection policies and processes of target companies, further complicating the deal-making process.
When it came to technology, respondents identified artificial intelligence and machine learning (46 per cent) and predictive analytics (37 per cent) as the technologies that will have the most long-term transformative impact on M&A due diligence. Notably, however, blockchain technology was not identified as a technology with a transformative role.
More than any other factor, 32 per cent of those surveyed said that being able to harness the information with data analytics technologies would most help in accelerating the due diligence process. Over the next five years, EMEA M&A professionals expect technology to change the due diligence process by providing greater security (63 per cent), supporting deeper analytical capabilities (61 per cent), and simplifying the entire process (45 per cent).
“The EMEA M&A environment faces a unique set of challenges as it looks to comply with new regulations and privacy requirements,” says Hilary London, Chief Revenue Officer and General Manager for EMEA at Merrill Corporation. “As we track transactions, it will be very telling how these challenges will impact organisations’ due diligence processes. Streamlining transactions via increased accessibility of transaction data will support greater transparency and enhance compliance, strengthening M&A activity in this market.”
