Background and Challenge
L.E.K. was brought on to support the separation, integration planning and execution for a client that was to acquire a similarly sized drug technologies company from a global pharmaceutical company.
The deal was transformative, moving our U.S.-centric, research-focused client company to a global one that greatly expanded its capabilities, products and services, operational scale, and geographic footprint.
A critical first step was to separate from the target’s parent company before integration activities could be completed. Maintaining business stability upon transaction close and ensuring a seamless transition during the early post-close period was key.
Longer-term, the combined company needed to realize its synergy targets as it sought to transform the combined business.
Approach and Recommendations
- Helped mobilize the integration teams, and established an integration management office to manage and oversee the planning and execution of the integration
- Supported the development of a detailed transition service agreement to achieve a faster and cleaner separation from the parent company, which ensured business stability during the integration process
- Provided support to several functional groups in developing detailed integration plans, including HR, communications, finance, IT, R&D, facilities, manufacturing and supply chain, quality, and regulatory affairs
- Worked with R&D and IT leadership to identify needed organizational changes and supporting integration plans that would better position those functions for longer-term success given the combined company’s strategic direction
The integration has proceeded efficiently and is on track to achieve our client’s goals.
We worked with the teams to develop comprehensive transition services agreements to adequately support the business during the near-term transition period. We helped prepare our client for a successful Day 1 and early post-close transition, with the following results:
- Synergy realization is expected to exceed the targets set during due diligence
- There were no supply interruptions, and revenues were protected on existing commercial products
- Back-office operations in finance, IT and HR ran smoothly during the transition
- Town hall meetings and employee communications were well-received and helped address employee concerns and establish a sense of unity across the combined company
We supported the development of detailed long-term integration plans across a number of functions.
In addition, we provided key support to the R&D and IT leadership teams to develop the right organizations to support the strategy of the combined company for the longer term:
- We worked with R&D to develop a detailed database and supporting integration plans to leverage the combined capabilities
- We helped IT develop an organizational vision to enable it to more effectively serve the combined business