How Cybersecurity Leaders Can Add Value to M&A Deals
Although mergers and acquisitions (M&As) are known to exponentially propel businesses, they involve several moving parts and pose a multitude of risks for buyers and sellers. One risk that is often ignored or underestimated is cyber risk. While a staggering $5 trillion worth of M&As happened last year, reports suggest that less than 10% of deals involve cybersecurity as part of the M&A due diligence process.
For the seller, any leak in customer or financial information, intellectual property or other confidential data can lead to a loss of reputation, valuation and competitive advantage. On the other hand, the buyer could blindly inherit cyber risk from the acquired company with little or no understanding of the security controls in place. The consequences could dramatically reduce the share price, erode market value and expose the business to a number of class action suits or federal and regulatory investigations.
How can information security leaders help?
Using the strategies outlined below, security leaders can help mitigate cyber risks during the M&A process and highlight to leadership the significant value information security brings to the table.
Inform initial deal-making
Offer advice to support due diligence
Determine responsibilities for pre-integration planning
Drive security integration.
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SUPPORTING CONTENTVIEW ALL NEWS ARTICLES
Information Security in Mergers and Acquisitions
This excerpt from the full ISF briefing paper introduces a typical four-step process and helps promote the value of security in M&A activity.
The Role of Information Security in Mergers and Acquisitions
Watch as Richard Absalom discusses considering security requirements during highly sensitive, fast-moving merger and acquisition activity.