Therese Holm is an Associate Director and Head of Tech in M&A in the Deal Advisory team. Therese has worked at KPMG for two years and works on advising clients on their technology assets in both pre- and post-deal phases. She has a background in Business & Technology from CBS and is a member of KPMG’s Sounding Board advising the Leadership team on internal initiatives.
What does Tech in M&A (Mergers and Acquisitions) entail?
Therese: My team provides transparency to our clients and ensures that a company’s technology does not impose any risks on the transaction and impact its value. We basically ensure that our clients are either getting or giving the fair value for the business in question. This happens primarily before the deal takes place. Once the deal has gone through, we can help our clients with integrating or separating the IT set-up, depending on the situation.
A Technology Due Diligence (Tech DD) is a comprehensive review of the technology environment of a business, such as IT infrastructure, software, security, processes, and tech product, with the goal to identify any potential transaction risks or opportunities.
Every company does tech or IT setups differently – and there’s no wrong way of doing it. So to assess a company’s tech is to understand, first, whether there’s any old technology – what we call ‘technical debt’. If there is, then we ask what the plan and the cost for replacing that technical debt is. And then we look at whether the technology and the IT is designed for scaling and for growth – and we can, for example, benchmark any investments needed to other similar companies and show whether it’s in line with peers or not.
"Compared to our competitors, we’re one of the only firms that has a dedicated team who specialises in assessing tech during deals"
Why should companies invest in Tech Due Diligence when undergoing deals?
Therese: Think of technology as the infrastructure of a house you’re about to purchase: the decoration is great; however, you can’t always evaluate the plumbing, or know how safe the electricity is without an expert telling you so. If you only look at a company’s financial data, you won’t be able to understand how valuable the technology is and how mature the company is with their tech. This goes for cybersecurity as well as their software and hardware.
In almost every transaction, regardless of sector, it is relevant to perform a tech due diligence. We pinpoint external and internal risks and then create a plan to mitigate them together with the client. Often, we find adjustments to the transaction value stemming from the company’s tech – and these aren’t necessarily negative adjustments. We also find opportunities and present them in a way that can increase the value of the company.
What difference does your work make for clients during an M&A?
Therese: We have this saying in M&A: 1+1 must always equal more than two. Whenever a company acquires another one, the added value must come from all the synergies that are uncovered by the deal. And that’s where we help: we identify where the synergies are, especially from a technology perspective. Compared to our competitors, we’re one of the only firms that has a dedicated team who specialises in assessing tech during deals, and I think that’s where we make the biggest difference for our clients. We are able to bring niche expertise from the KPMG network and really answer all our clients’ needs and questions on anything tech-related.
Our clients definitely see the need in assessing technology in a deal as well. We are an objective and independent third party, so our assessment can be used to negotiate the final price or to add weight to a decision internally, regardless of which side we are on. We add that extra validation, fact-checking the information that shows the truth about a company’s technology infrastructure.
Another way we make a difference for our clients is on guiding them through mergers and acquisitions or carve-outs. Most people will only experience this only once in their career – we do it a couple of times a year. This allows us to be proactive with our clients, help them prioritise, advise them on the business continuity and build trust.
Deals are also about people: how do you ensure they feel supported and involved in the change process?
Therese: Working with deals can be a very secretive activity, until the deal becomes public – and then we might experience fear and resistance to change. What I can do to ease the process is to advise the client’s leadership team in critical decision making and then empower them by supporting their project planning, communication, and transparency towards their own organisation.
It requires being delicate in the way you communicate. When I hire people in my team, I always look for strong people skills, in addition to the analytical ones that you’d expect the candidate to have, because we are accompanying people through uncertainty. We have colleagues who work on assisting HR teams through organisational change, but we are all equipped with a good change management understanding to best support our clients.
What advice can you give to women who would like to join the tech and deal field?
Therese: What has helped me is to have role models to look up to – such as Lauren and Kathryn in the Deal Advisory team. It’s no secret that the M&A and Tech sectors are male-dominated, so I hope that I can in turn inspire younger women to seek careers in these fields and show them that it’s possible to climb the career ladder – while having a life. I can see that more women are slowly choosing this career path amongst students and that’s encouraging.
But I would also advise them to take ownership: don’t wait for things to happen. I aim to be visible externally by presenting at universities or participating in networking groups. But I’m also engaged internally: I joined KPMG’s Sounding Board to give input to our leadership team on what they can do differently. I always think to myself that if I want something to change, then I have to do it myself: have the difficult discussions and challenge other’s perspectives, because if I don’t, then nothing will happen. So as long as you show up, then you can make a difference somehow.
"In almost every transaction, regardless of sector, it is relevant to perform a tech due diligence"
Therese Holm
Associate Director, Transaction Services, Head of Tech M&A
KPMG in Denmark
