Private Markets Due Diligence Places Outsized Demands on Dealmakers
SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) has released the 'SS&C Intralinks How Deal Terms Impact Due Diligence' report, analyzing over 900 global M&A transactions from 2013 to 2023. Key findings reveal that private target due diligence periods are nearly twice as long as public acquisitions, averaging 234 days compared to 125 days. Private deals also require almost double the documentation and collaboration.
The study highlights that medium-length due diligence periods of around 139 days tend to produce the best outcomes, with higher completion rates and better total shareholder returns of up to 4%. The research also notes an increase in the average pre-announcement due diligence period from 124 days in 2014 to 203 days in the last decade.
SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) ha pubblicato il rapporto 'SS&C Intralinks: Come i termini dell'accordo influenzano la due diligence', analizzando oltre 900 operazioni di fusione e acquisizione globali dal 2013 al 2023. I risultati chiave rivelano che i periodi di due diligence per obiettivi privati sono quasi il doppio rispetto a quelli pubblici, con una media di 234 giorni rispetto ai 125 giorni. Inoltre, le trattative private richiedono quasi il doppio della documentazione e della collaborazione.
Lo studio evidenzia che i periodi di due diligence di lunghezza media, intorno ai 139 giorni, tendono a produrre i migliori risultati, con tassi di completamento più elevati e un miglior rendimento totale per gli azionisti fino al 4%. La ricerca nota anche un incremento del periodo medio di due diligence pre-annuncio, passato da 124 giorni nel 2014 a 203 giorni nell'ultimo decennio.
SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) ha publicado el informe 'SS&C Intralinks: Cómo los términos del acuerdo afectan la debida diligencia', analizando más de 900 transacciones de fusiones y adquisiciones globales desde 2013 hasta 2023. Los hallazgos clave revelan que los períodos de debida diligencia para objetivos privados son casi el doble que los adquisitivos públicos, promediando 234 días en comparación con 125 días. Las operaciones privadas también requieren casi el doble de documentación y colaboración.
El estudio destaca que los períodos de debida diligencia de longitud media, alrededor de 139 días, tienden a producir los mejores resultados, con tasas de finalización más altas y un mejor rendimiento total para los accionistas de hasta el 4%. La investigación también señala un aumento en el período promedio de debida diligencia preanuncio, pasando de 124 días en 2014 a 203 días en la última década.
SS&C 테크놀로지스 홀딩스, Inc. (Nasdaq: SSNC)가 2013년부터 2023년까지의 전 세계 M&A 거래 900건 이상의 분석을 담은 'SS&C 인트라링크스: 거래 조건이 실사를 미치는 영향' 보고서를 발표했습니다. 주요 발견으로는 민간 대상의 실사 기간이 공공 인수의 거의 두 배에 달한다는 점이 밝혀졌습니다. 평균적으로 민간 거래는 234일, 공공 거래는 125일입니다. 또한 민간 거래는 거의 두 배에 달하는 문서와 협력이 필요합니다.
연구는 약 139일 정도의 중간 실사 기간이 가장 좋은 결과를 낳는 경향이 있다고 강조하며, 더 높은 완료율과 최대 4%의 유동주주 수익률을 보여줍니다. 또한 연구에서는 2014년에는 124일이었던 평균 발표 전 실사 기간이 지난 10년 동안 203일로 증가했다고 언급합니다.
SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) a publié le rapport 'SS&C Intralinks : Comment les conditions des accords influencent la due diligence', analysant plus de 900 transactions de fusions et acquisitions mondiales entre 2013 et 2023. Les résultats clés révèlent que les périodes de due diligence pour les cibles privées sont presque deux fois plus longues que celles des acquisitions publiques, avec une moyenne de 234 jours contre 125 jours. Les transactions privées nécessitent également presque le double de documentation et de collaboration.
L'étude souligne que les périodes de due diligence de longueur moyenne, autour de 139 jours, ont tendance à produire les meilleurs résultats, avec des taux d'achèvement plus élevés et un meilleur rendement total pour les actionnaires allant jusqu'à 4 %. La recherche note également une augmentation de la période moyenne de due diligence avant annonce, qui est passée de 124 jours en 2014 à 203 jours au cours de la dernière décennie.
Die SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) hat den Bericht 'SS&C Intralinks: Wie sich die Bedingungen von Deals auf die Due Diligence auswirken' veröffentlicht, in dem über 900 globale M&A-Transaktionen aus den Jahren 2013 bis 2023 analysiert wurden. Die wichtigsten Erkenntnisse zeigen, dass diese Due-Diligence-Zeiträume für private Ziele fast doppelt so lang sind wie bei öffentlichen Übernahmen, mit einem Durchschnitt von 234 Tagen im Vergleich zu 125 Tagen. Private Deals erfordern zudem fast doppelt so viel Dokumentation und Zusammenarbeit.
Die Studie hebt hervor, dass mittellange Due-Diligence-Zeiträume von etwa 139 Tagen tendenziell die besten Ergebnisse liefern, mit höheren Abschlussquoten und einer besseren Gesamtrendite für die Aktionäre von bis zu 4%. Die Forschung stellt außerdem einen Anstieg der durchschnittlichen Due-Diligence-Zeiten vor der Bekanntgabe fest, die von 124 Tagen im Jahr 2014 auf 203 Tage im letzten Jahrzehnt gestiegen sind.
- SS&C Intralinks has executed more than USD 35 trillion worth of financial transactions on its platform
- Medium-length due diligence periods (139 days) are more likely to result in deal completion
- Deals with medium-length due diligence periods produce the best total shareholder returns of up to 4%
- Private target due diligence periods have increased to an average of 234 days, nearly twice that of public acquisitions
- The pre-announcement due diligence period has stretched from 124 days in 2014 to 203 days in the last decade
- Buyers are less likely to pay a premium on medium-length due diligence deals, with an average price appreciation of 22% compared to 30-33% for short and long periods
Insights
This report highlights significant trends in M&A due diligence, particularly the growing complexity of private market deals. The extended due diligence periods (234 days for private vs. 125 for public) and increased documentation requirements (7,583 files vs. 4,896) suggest higher risks and costs for acquirers in private markets.
Notably, medium-length due diligence (139 days) correlates with better outcomes, including higher completion rates and optimal shareholder returns. This indicates a sweet spot in the due diligence process, balancing thoroughness with efficiency. For investors, this implies that companies adept at managing this optimal due diligence timeframe may have a competitive edge in M&A activities.
The trend towards longer, more complex due diligence also underscores the growing importance of technology solutions like Virtual Data Rooms. Companies providing these services, such as SS&C Technologies, may see increased demand, potentially boosting their market position and revenues.
The findings reveal a significant shift in M&A dynamics, particularly in private markets. The nearly doubled due diligence period and documentation for private deals compared to public ones indicates a heightened level of scrutiny and caution among buyers. This trend could potentially slow down deal velocities and increase transaction costs in the private equity and venture capital spaces.
Interestingly, the data suggests an optimal due diligence window of around 139 days, balancing thoroughness with efficiency. Deals within this timeframe show higher completion rates and better shareholder returns, up to
The increasing complexity also highlights the growing importance of specialized M&A technologies and services. Companies that can effectively streamline the due diligence process while maintaining thoroughness may gain a competitive advantage in facilitating successful transactions.
Extensive study by SS&C Intralinks, Bayes Business School and Mergermarket examines how due diligence has changed in the last decade
WINDSOR, Conn., Aug. 15, 2024 /PRNewswire/ -- SS&C Technologies Holdings, Inc. (Nasdaq: SSNC) today announced the publication of the SS&C Intralinks How Deal Terms Impact Due Diligence report. The M&A Research Centre at Bayes Business School (formerly Cass) analyzed more than 900 global M&A transactions announced between 2013 and 2023, drawing on data from SS&C Intralinks' proprietary database. The study found a private target's average due diligence period is nearly twice as long as a public acquisition's. Moreover, private deals require nearly twice as much documentation and collaboration.
"Dealmakers continue to pursue multiple opportunities in private markets, but the environment for fundraising and deploying capital is challenging," said Ken Bisconti, Co-Head of SS&C Intralinks. "Due diligence periods have gotten longer, and the process has gotten more complex, often requiring more documentation. This research confirms the growing importance of Virtual Data Rooms and other digital spaces for managing due diligence processes efficiently and effectively."
Key findings from the report include:
- The average due diligence period, from VDR opening to the public announcement of a deal, takes 234 days for a private target versus 125 days for a public one. In the last decade, the pre-announcement due diligence period has stretched to 203 days from 124 days in 2014.
- On average, private targets upload 7,583 files to a VDR versus 4,896 documents for a public deal. For medium-sized deals – most prevalent in the market today – the number of files uploaded goes up to over 8,000.
- More people are involved in due diligence for private deals, with an average number of 271 VDR users collaborating versus 195 users for a public target.
The research also found medium-length due diligence tends to produce the best outcomes:
- Deals with medium-length due diligence periods of around 139 days are more likely to be completed. Such deals are likely to take 104 days from start to finish.
- Buyers are less likely to pay a premium on medium-length due diligence deals, with the price moving about
22% during such reviews. The average price appreciation following short and long due diligence periods is30% and33% , respectively. - Deals with medium-length due diligence periods produce the best total shareholder returns of up to
4% , while short or lengthy due diligence periods often result in adverse outcomes.
Learn more about how deal terms impact due diligence here and read more about due diligence dynamics here.
SS&C Intralinks is a pioneer of the virtual data room, delivering software-enabled services across the entire deal lifecycle, including deal marketing, deal prep, due diligence, insights and post-merger integration. Intralinks technology enables and secures the flow of information by facilitating M&A, capital raising and investor reporting. SS&C Intralinks has executed more than
About SS&C Technologies
SS&C is a global provider of services and software for the financial services and healthcare industries. Founded in 1986, SS&C is headquartered in
Additional information about
SS&C (Nasdaq: SSNC) is available at www.ssctech.com.
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About M&A Research Centre
The M&A Research Centre at Bayes, which was founded in 2008, is the only research centre at any major business school focused on both the research and practice of mergers & acquisitions. Bayes Business School is part of City St George's, University of
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SOURCE SS&C
FAQ
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