Move guide
Protect the value through the deal
Your report suggested a move on at least one of these two questions:
- whether the value survives the deal: the people, the customers and the consents;
- whether the key risks are dealt with, the integration risks included.
This move guide finds the contracts, customers and people the value depends on, and protects them before close. It keeps the base business running while the integration takes people away. Then it gives every key risk an owner and a fix or a price.
1. When it applies
Use this move guide if your report placed either question at "Red flag" or "Doubtful".
| Question | Where it may sit today | Where this move guide aims |
|---|---|---|
| Does the value survive the transaction (people, customers, consents)? | Red flag: "The value walks: key people are looking, key customers or channels can leave on change of control, and the base business is already wobbling under deal load." Doubtful: "People, contracts, customer reaction and leadership bandwidth haven't been examined." |
Supported: "Retention designed, critical consents secured, largest customers sounded out, and the base business protected with dedicated integration resourcing." |
| Are the key risks dealt with, including integration risks? | Red flag: "Known risks, integration included, are being explained away in the deal fever." Doubtful: "Key risks sit at the back of the report, unowned, and integration risk isn't on the list." |
Supported: "Every risk, including the integration risks, carries mitigation with an owner or a price adjustment." |
If both already sit at "Supported" or higher, skip this move guide.
2. What to do
Four steps. They run from signing to the end of the integration.
- Read the key contracts for change of control. List every consent the deal needs, and who gives it.
- Sound out the largest customers, and list the people the value depends on. Design a retention plan for each person.
- Backfill the roles the integration will take, so the base business keeps running.
- Give every key risk an owner, and a fix or a price adjustment. Agree the walk-away triggers before the next round.
Table A below holds the value at risk and the risk register.
3. What to produce
One table.
Table A. Value at risk, and the risks
| Item | Owner (name) | Fix, retention plan or price adjustment | Walk-away trigger |
|---|---|---|---|
| Contract with a change-of-control clause | |||
| Largest customer | |||
| Key person | |||
| Role the integration will take, and its backfill | |||
| Integration risk |
A risk with no owner will be found again after close, by someone else.
4. A worked example
Illustrative. Written for this move guide. It describes no client.
A building services group is buying a fire-safety contractor. Its due diligence report lists eleven risks on the last page, none with an owner.
The contracts.
- Three of the five largest maintenance contracts let the client end them on a change of control. The deal lead met all three clients before signing. Two gave written consent, and the third renewed early.
The people.
- Two engineers hold the certifications most contracts need. Both have retention bonuses tied to the first two years.
The risks.
- Each of the eleven risks now has an owner. Two became price adjustments, and one became a walk-away trigger.
One month on.
- 3 of 3 change-of-control contracts secured
- 2 key people with a retention plan
- 11 of 11 risks with an owner
On a retake, both questions could be answered at "Supported".
What it looked like in our work
From our own work. Figures changed.
For a buyer of a healthcare services provider, our due diligence listed every contract the main funder held with the target. For each, it showed the share of revenue, when it next went to tender, and the risk of losing it.
| Contract | Share of the funder's revenue (%) | Next tender | Risk of losing it | Why |
|---|---|---|---|---|
| Return-to-work services | 62 | In about two years | Low | Performing well on the funder's measures. A new tender could add another provider. |
| Pain management | 15 | In about a year | Medium | The funder could send patients to public hospitals instead. The margins are low anyway. |
| Concussion services | 4 | In about three years | Low | One right to renew for two more years. |
| Nine smaller contracts | 19 | Various | Low | Small, and spread across services. |
One contract carried most of the value, so the deal turned on its next tender. The register made that visible before the price was set.
5. Effort and dependencies
- Deal leadReads the contracts and owns the risk register.
- Integration leaderPlans the backfill and the retention.
- LegalFinds every change-of-control clause and consent.
What you need
- The key contracts, and the list of people the value depends on.
- The walk-away price from setting the price you will walk away at.
How long
- From signing to the end of the integration.
What gets in the way. We have seen these in our own work:
- Contracts that end during the deal. In an outsourced services business, every top contract expired within a few years, and the two largest were up for renewal during the deal.
- An advantage held by two people. At a building-products manufacturer, two employees held every national account.
6. How will you know it worked?
The test is what is secured before close, and who owns each risk. Retake the check before signing. Each of these should be true when you answer:
| Question | You can answer Supported when | A document alone does not count if |
|---|---|---|
| Does the value survive the transaction (people, customers, consents)? | Retention is designed, consents are secured, the largest customers are sounded out, and the base business has its backfill. | The clauses are listed, and nobody has met the customers. |
| Are the key risks dealt with, including integration risks? | Every risk, integration included, has an owner and a fix or a price adjustment. | The risks are listed at the back of the report, with no owner. |
The worked example is illustrative.
Think we've used your work without proper credit? Tell us and we'll fix it.