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Compensation is a key to M&A Success
"The key is to select and retain the people best suited to lead the new organization and fulfill the strategic intent of the transaction."
Every merger and acquisition (M&A) faces challenges unique to the businesses involved, the types of buyers and sellers, and the strategic goals of the deal. Executive compensation matters often take front and center stage in all phases of the transaction—from the planning stage through post-closing integration.
Companies undergoing such major transitions expect to unlock significant value; and compensation—particularly when considered very early in the process—can play a key role in optimizing changes, driving successful outcomes, and providing the new entity with a competitive advantage.
Our Approach to M&As
Innovation
Pearl Meyer’s experienced merger and acquisition consultants anticipate the challenges that can emerge in all phases of a transaction and work to create customized solutions that maintain focus on unlocking the value of the deal and creating long-term value.
Commitment
Our senior professionals bring decades of knowledge and expertise in legal, tax, accounting, SEC, actuarial, and communication matters related to M&As. Together, we navigate the maze of strategic technical issues quickly and with precision, and provide compensation advice tailored to each specific transaction. We are noted for our responsiveness and commitment to delivering the highest quality work in the industry.
Confidence
We have been advising clients undergoing transactions and changes to their business models for more than 25 years. Our experience spans a wide range of clients and industries. We have managed compensation matters on the smallest transactions to deals exceeding $40 billion in value.
Service Offerings
Change-in-Control (CIC) Planning
When assisting companies with the design, modeling, and implementation of their CIC programs, our technical yet practical analysis helps clients:
- Evaluate the competitiveness of their programs
- Understand the unique tax, accounting, and SEC disclosure issues involved
- Quantify potential payouts
- Estimate golden parachute excise tax liabilities and lost tax deductions
- Develop annual proxy disclosures
Pre-Merger Planning
When a transaction approaches, a multitude of compensation-related matters will arise that must be addressed by both the buyers and sellers including:
- Due diligence reviews, including identifying and quantifying deal-related executive compensation liabilities and payouts
- IRC 280G “golden parachute” analyses
- IRC 280G “reasonable compensation” analyses
- Design and costing of severance and retention plans
- Development of key employee transaction bonus plans
- Establishing proposed replacement compensation structures
- Structuring new employment contracts for management
Post-Merger Integration
After the transaction close, we help clients to finalize tailored, competitive compensation solutions that support the strategic vision of the deal by:
- Comparing target and buyer compensation philosophies
- Assisting compensation committees in developing a new compensation philosophy
- Evaluating the competitiveness of the existing programs
- Designing new compensation structures for base salary and annual- and long-term incentives
- Revising or implementing new severance and CIC plans
Ask the Expert
Ask the Expert
Margaret H. Black
Margaret works with organizations undergoing changes in their business structure. She helps navigate the complex web of practical, technical, and regulatory issues quickly and with precision, giving clients the freedom to focus on their business strategy.