In part 1 of our M&A survey, we focused on the collaboration of M&A leaders within their organization.
Today, we’ll be evaluating how strategic corporations approach M&A, and what the main source of deal origination is. For that, we surveyed our network of 200+ professionals with buy-side Corporate Development and M&A experience.
Deal origination: It’s a mixed bag of nuts
In last week’s survey, we already concluded that M&A leaders are deeply integrated with their business units, senior leadership, and departments like Sales and Finance.
That also shows in the sources for deal origination. 31% of Corporate M&A professionals mention their network as main sources for deals, which, by extension, also includes the 6% that leverage their own investor network.
Almost 1 out of 3 Corporate Development professionals sources deals through the know-how of the internal organization and internal departments. Another third mainly sources through Investment Banks and M&A sell-side advisors.
Overall, one of the core competencies for deal origination seems to lie within the ability to leverage internal and external stakeholders.
The role of Corporate Development: Execution or strategic spotting of opportunities?
Many M&A leaders are degraded to only executing deals that leadership or business lines originate. Or are they?
The Corporate Development professionals that we surveyed show a different picture: A whooping 82% are actively involved in identifying acquisition opportunities. Only 18% are mainly executing deals.
Is M&A a core competency?
The mere existence of a Head of Corporate Development or M&A might imply that M&A is perceived as core competency of an organization. But despite the last question, our data paints a different picture: Only half of M&A leaders agree that M&A is a core competency for their organization. The other half still perceives their M&A activities as being rather reactive.
Is your corporate strategy dependent on effective M&A?
In line with M&A not being a core competency for half of organizations, 2 out of 3 M&A leaders in our survey emphasize that the corporate strategy is not dependent on effective execution of acquisitions.
It’s still very much a vital part of the overall growth strategy, but as one surveyed professional puts it, rather an accelerator than a key driver.
Effective M&A is not the main driver of the strategy, but effective M&A is essential to reach certain goals faster.
Are you focused on acquisitions, joint ventures, or others?
When it comes to the main activities for the M&A leaders in our survey, the data shows very clearly that 90% of them are focused on acquisitions first.
A large chunk (40%) also executes on joint ventures and partnerships, but the focus still lies within acquisitions.
Last part of the survey: Skills and career steps
Follow us to see the results of our conclusive questions on the key skills and next career steps for Corporate M&A leaders.