What the Arrival of Artificial Intelligence Means for M&A

A brave new world is upon us in the M&A field. Artificial intelligence is already starting to change the way firms conduct transactions. While AI can be a boost to companies looking to sell, it also requires knowledge to harness the power of this technology. The Symmetrical team is constantly evaluating changes to the M&A field. Here’s how we anticipate AI will transform the M&A landscape.

Identifying Targets

Finding the right target for an acquisition — or from the seller’s side, the right buyer — is ultimately the most important part of an M&A deal. No amount of good work on a deal can overcome a bad match between two companies.

One of AI’s great strengths is its ability to churn through large amounts of data. Previously, the work of finding potential targets for a deal required tracking down piles of data on companies — and then sifting through them. Artificial intelligence makes this work considerably easier. Not only can AI analyze data rapidly, but it may be able to propose targets that wouldn’t have otherwise been on a company’s radar. For a business looking to sell, AI can also provide insight into what types of buyers are likely to be the best fit and most interested in a deal.

Changing Due Diligence

Due diligence in M&A has already been disrupted once. The advent of virtual data rooms (VDRs) completely changed the way an M&A deal takes place, providing a secure, virtual place for representatives on both sides to review company fundamentals.

AI has the potential to add even more efficiency to this process. For instance, AI could be able to automatically organize documents that have been uploaded to the VDR, streamlining analysis by team members.

AI technology could also offer summaries of documents, providing high-level takeaways and acting as a first line of defense, suggesting key areas for team members to review themselves. (It’s important to remember, however, that AI can make mistakes, which is why a human review remains essential.)

Determining Company Valuations

When it comes time to determine company valuation, there’s a role for AI to play as well. Not only can artificial intelligence assist with the internal calculations that produce a company valuation, but it can also scan the reams of publicly available data on similar transactions to get a better sense of your company’s market value. This can ensure that if you decide to sell, you maximize your company’s value.

Where People Meet Technology

There’s a common misconception that AI will replace humans. At least when it comes to M&A, that’s not the case. Or at least it shouldn’t be the case. The power of AI isn’t that it does a deal for you — from finding the target to performing the due diligence to closing — but that it streamlines the process, and maybe even generates new ideas that you wouldn’t have otherwise considered.

The way we see it, AI becomes most impactful when it’s deployed strategically by professionals. Get in touch with us today to learn more about how we’re using new technology to help business owners get the best possible deal when it comes time to sell.