After The Time Warner-AT&T Debacle, An Already Uncertain M&A Climate Remains MurkyWill Schenkel
Yesterday the Circuit Court of Washington DC ruled against the US Justice Department, effectively approving AT&T’s bid for Time Warner. The six-week trial over an $85 billion deal has raised questions about other acquisitions and heightened ambiguity about M&A activities.
But it isn’t just the high-profile cases like this one, or Disney’s bid for 21st Century Fox (or Comcast’s for that matter) or T-Mobile’s efforts to merge with Sprint that should be taking cues from these developments; those involved in smaller deals, especially in instances where the parties have assets that could be drawn into politics (not unlike Time Warner’s CNN), should be watching these developments with concern as well.
This government interdiction represents a larger, highly fluid, political environment and rapidly changing landscape that requires new tactics to keep ahead of incidents or lawsuits that can scuttle deal-making. As some analysts and deal professionals were caught off guard both by the Justice Department’s initial challenge and the eventual court ruling, the value of business intelligence with outside perspectives comes into view.
The reality is that the clues were out there from the beginning when it comes to both the DOJ’s challenge to this deal, the eventual arguments that were made, and ultimately, the final result. More specifically, a research program that includes both examination of the issue itself and in-depth vetting of the major players would have provided dealmakers and legal teams with a more comprehensive lay of the land from which to craft their strategies.
An opposition researcher makes for the perfect bloodhound to hunt down the otherwise disjointed hints from anywhere in the public record. If it exists, these operatives are trained to find it no matter the forum, and the proper research regimen could have helped to preempt any of the shocks witnessed through this process by allowing those involved to make more informed decisions based on more than just economic data.
While looking into the above is crucial to get a fuller picture of the terrain, it still only gives part of the story. A fuller picture comes together when you pair this research with the correct up-to-the-minute intel and analysis in the media. Having a better understanding of the environment includes keeping on top of statements from relevant officials and other influencers driving the conversation while also keeping the pulse of the narrative through print and social media such that decisionmakers are kept up to date on rapidly changing developments impacting them.
Definers’ analysts come from campaigns and from the private sector and have isolated the best practices for this type of monitoring and identifying trends that would otherwise be missed by somebody with different training. These analysts have the necessary backgrounds and the systems in place to provide actionable intelligence for dealmakers to keep ahead of opponents of all kinds.
Ultimately, there’s information that isn’t available without special effort – namely communications and documents from public officials that can shed light on what officials are truly thinking or what may be coming next. An aggressive campaign using the Freedom of Information Act (FOIA) would help company representatives anticipate future moves and act accordingly with information exclusively available to them.
Though the AT&T-Time Warner deal is safe (for now), the larger swath of M&A potential isn’t necessarily afforded the same luxury. In its aftermath, the industry should take a moment to reassess the terrain and prepare accordingly to ensure the success of future deals.