aerial view of a body of water surrounded by green pastures with a road to the right

Mergers & Acquisitions

A deep understanding of organisations, their people,
culture and risk profile.

Pensions and benefits

Financial and HR challenges

Pensions and employee benefits can significantly impact on M&A success or failure, from both a financial and HR perspective. 

As the leading provider of employee benefit consulting services to today’s global organisations, Willis Towers Watson can help you to identify and quantify the financial exposures, guide you through the HR challenges, and deliver tailored solutions to ensure a successful outcome.

How we can help you gain advantage

At every stage of the M&A process, we’ll help you to:

  • Identify and analyse the organisation’s benefit programmes, including cash and accounting costs
  • Gain clarity on the financial, HR and regulatory risks, and ensure compliance
  • Manage the exposures, by providing market-leading insights and solutions
  • Consider pensions and benefits holistically, alongside wider HR and business risks, by leveraging our broader and unique M&A capabilities
  • Develop and deliver an effective benefits integration strategy, to help you exceed the M&A goals set for both the short and long term.

Our services

Our experts will work with you to firstly understand your deal goals and drivers. 

Armed with this key information, we’ll help you to identify and manage the financial and HR risks and challenges. In some cases, we’re able to commence this process before due diligence begins, by analysing publicly available information.

We’ll work with you to quantify and mitigate the risks identified, including support with negotiating deal terms. And, planning ahead, we’ll help you to prepare for day one and beyond, and identify opportunities for synergies available from pooling or rationalising benefit programmes.  

By preparing side-by-side analysis, we’ll also identify potential harmonisation costs and benchmark benefit programmes against competitive norms and best practices using our proprietary database.

From advising on over 2,000 deals each year in over 120 countries, we can provide essential country- and industry-specific expertise and insights. We’re also able to ensure global consistency and coordination throughout the M&A process – which can be essential given the timescales and complexity often involved.  

Importantly, we recognise that pensions and benefits are often a long-term commitment.  We’ll provide solutions not just for today but also for the future, to help you achieve long-term success from M&A. 

Case study - Pensions and benefits – from due diligence to ongoing support

Situation

  • Our client wished to acquire a business unit of another organisation and needed a single, global resource to carry out and coordinate employee benefit due diligence and subsequent integration activities.
  • Our investigations revealed the target company offered relatively generous employee benefits including defined benefit pension provision.
  • Whilst the intention was that employees would transfer from defined benefit to defined contribution pensions, this presented significant workforce relation challenges. Furthermore, our due diligence support identified that certain defined benefit pension and long-term ill-health liabilities would transfer with the business under law.

Solution

  • We used our plan change experience and proprietary industry and country-specific benchmarking data to help the client develop and communicate a compelling proposition to the new workforce.
  • We supported deal term negotiations by identifying and quantifying the potential exposures, enabling these to be factored into deal pricing with appropriate protections in the sale and purchase agreement and through the use of insurance solutions.
  • We identified future benefit cost savings available as a result of economies of scale from having a larger workforce and from rationalising benefit programmes.

Outcome

  • All employees were successfully transferred to a harmonised and modern level of future benefit provision aligned with the organisation’s overall rewards philosophy.
  • Legacy pension and benefit risk exposures were mitigated or compensated for in deal pricing.
  • With our help, the combined organisation also achieved significant employee benefit-related cost synergies from rationalising arrangements and negotiating benefit plan provider terms.