How to Prepare for and Handle a Merger or Acquisition

Author: Brightmine Editorial Team

While HR has prominent roles in many crucial workplace functions like recruiting and hiring, benefits administration, employee management and employee terminations, a restructure, like a merger or acquisition is when HR really has a chance to shine. In today's volatile economy with restructuring, bankruptcy and acquisitions all too common, HR must be prepared for the monumental but crucial task of preparing for and handling a merger or acquisition.

The key for HR when it comes to mergers and acquisitions is due diligence. As part of the due diligence process, HR should lead the way in examining company policies and procedures and comparing them with procedures from the company to be acquired or merged. In this regard, HR acts much like a gatekeeper - tasked with allowing only compatible policies or procedures into the organization. Engaging in this analysis enables HR to do one of its most important jobs: identify risk.

This process is crucial for the completion of a restructure, may play a significant role in the negotiations between the two (or more) companies involved, and may even determine whether the restructure will ultimately be successful. For example, if HR goes through this process and the information it provides helps to determine that the cost of the acquisition will be too high, this is actually considered a "good" failure. In that situation, HR helped to prevent a potential failure of the company based on the incompatibilities and risks identified.