Mergers & Acquisitions

In the utilities sector, as well as in many other industries, most M&A transactions have fallen short of achieving the desired financial benefits. To ensure M&A transactions succeed, companies need to focus on the deal logic and drivers of value, set clear integration priorities, start the transition early, and execute rapidly.

Oliver Wyman has assisted many companies in implementing M&A transactions in the areas of:

Targeting
Strategic due diligence
Synergy analysis
Post-merger integration

Recent engagement examples

Due diligence: Oliver Wyman has assisted a number of utilities in screening and evaluating potential synergy targets. We help our clients to evaluate the types of acquisitions and companies that would best fit with their strategy, identify potential candidates, and then estimate the potential value that would be created from the combination. We use a proprietary set of databases and tools to estimate the cost-savings synergies associated with the personnel savings from combining utility companies and the potential non-labor savings that could accrue from the combination.

Post-merger integration: Oliver Wyman has assisted numerous pairs of utilities to develop and implement integration plans that deliver required operational performance while realizing savings that exceed synergy targets. In these assignments, we have designed and staffed the integration project management office (PMO) and have provided expertise and assistance to functional integration teams. During a recent assignment, we supported the functional integration teams of a North American utility to consolidate "back office" functions and drive consistency throughout the organization. Results exceeded anticipated savings by over $70 million annually and addressed chronic performance issues in the target company, reducing write-offs by 50 percent and call durations by 10 percent.