Sergio Leal and Jan Sprafke on M&A Compliance Due Diligence [Podcast]

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By Adam Turteltaub

Mergers and acquisitions create stress, opportunity and risk both for the organization and the compliance team. In this podcast, Sergio Leal, who until recently was head of M&A compliance at Ericsson along with Jan Sprafke, the company’s chief compliance officer, share their advice for compliance professionals in the midst of a transaction.

They stress that the compliance team needs to be involved during the entire lifecycle, from target identification to due diligence to post-acquisition integration. This will help the organization avoid unanticipated liabilities and risks.

To ensure success the compliance team needs to be embedded in the M&A team. Meet with the stakeholders regularly to ensure you are aligned with their processes. When you do, remember that compliance is just one piece of a very complex puzzle.

Be prepared to move quickly. The DOJ amnesty program for issues discovered in an acquisition has a rapidly ticking clock.

At the start of an acquisition or merger, they recommend focusing on three areas:

  1. The ultimate beneficial owner
  2. The operations of the business
  3. The already existing compliance program, if any, and internal controls

Be especially vigilant if the acquired entity had some government ownership or government contracts. And, be very diligent if there is not a compliance program already in place.

Listen in to learn more about how to be an integral part of mitigating the risks of mergers and acquisitions.