July 20, 2021

M&A Process: The Role of Social Media

Social media platforms are frequently an afterthought in M&A transactions. According to this recent blog from Sue Serna, that’s a big mistake. Sue highlights the reputational, legal, compliance and other issues that can arise if companies don’t get their social media teams involved in the M&A process well in advance of the closing. This excerpt discusses some of the potential reputational & legal risks associated with failing to do that:

Reputational risk: It’s ideal to loop your social team in before the deal closes, and they can actually help in the M&A process if you do so. Ask your social team to review the other company’s social media accounts and the chatter online about that company. This exercise can unearth reputational risks and highlight any ongoing issues consumers have with the company before you close the deal. Lest you think this is a fruitless exercise, I have seen deals where this analysis surfaced things concerning enough to actually stop the deal from proceeding, so they are well worth the effort.

Legal risk: Many people involved in the M&A process don’t realize that the acquiring company is legally responsible for everything that goes out on all social media channels starting on legal day one (the first day of the deal being final). That means the time to loop in the social media team is NOT on the day before day one. It’s really unfair to them to tell them that they are suddenly responsible for X number of new channels starting tomorrow, and it honestly opens the company up to all kinds of legal risks until they can coordinate with the social team at the other company and get everything under control.

John Jenkins