The Real M&A Value Isn’t in the Deal — It’s in Everything Around It

August 2026Strategy

M&A is one of the most powerful tools for corporate growth—and one of the easiest ways to destroy value. After years of advising technology companies on acquisitions and later experiencing them from the operator’s side, I have come to believe that value in M&A is rarely created in the transaction itself. It is created before the deal, around the deal, and especially after the deal closes.

Mergers and acquisitions are often presented as a relatively simple equation:

Buy a capability. Add synergies. Grow faster. Create value.

The reality is considerably more complicated.

An acquisition can make strategic sense and still fail. A company can pay what appears to be a reasonable price and still destroy shareholder value. A transaction can close smoothly and yet struggle for years to deliver the capabilities, growth, or synergies that justified it in the first place.

The reason is that an acquisition is never one decision. Rather a chain of decisions, ranging from the initial strategic rationale, through target selection and diligence, to valuation, negotiation, integration, and ultimately the realization of the business case. Each M&A stage shapes a different part of the value equation.

I first developed this perspective while advising technology companies on M&A. Years later, after moving into an operating role and participating in acquisitions and integration at HP, I found myself viewing the same problem from the other side of the table. That experience reinforced a simple principle:

The objective of M&A is not to complete the transaction. The objective is to create more value than the company could have created without it.

That distinction changes how I think about M&A value.

1. Start with the strategy, not the target

One of the easiest ways to get M&A wrong is to start with a company you want to buy rather than a strategic problem you need to solve. A compelling target can create its own momentum.

The management team becomes excited about the technology, the product, the market position, or the people. Investment bankers develop a valuation range. The strategic rationale gets constructed around the target.

The question gradually changes from:

“Should we acquire this capability?”

to:

“How do we make this acquisition work?”

That is a dangerous transition.

A better starting point is to define the strategic objective independently of any particular target.

For example:

Do we need to enter a new market?
Do we need a capability that would take too long to build?
Are we trying to accelerate an existing growth strategy?
Do we need technology, talent, distribution, or intellectual property?
Is the objective revenue growth, cost reduction, strategic positioning, or some combination?

Then ask a more uncomfortable question:

Does M&A actually represent the best way to accomplish that objective?

The alternatives may include building internally, partnering, licensing technology, investing organically, entering a joint venture, or simply doing nothing. The acquisition should win that comparison and not be exempt from it.

This sounds obvious, but it is one of the most important disciplines in M&A because acquisitions create organizational momentum. Once a potential target becomes visible, it can be surprisingly difficult to step back and ask whether the transaction itself is the right answer.

2. Value is created — or destroyed — across many dimensions

Another mistake is treating value creation as primarily a pricing question. Price obviously matters. But where value comes from is much broader. I think about it across several dimensions:

Strategic value

Is the acquisition actually aligned with the company’s strategy?
Will the combined company be meaningfully better positioned than the standalone businesses?
Could the market, technology, or competitive environment evolve in a way that undermines the thesis?

Financial value

Are the assumptions behind the valuation realistic?
How much growth is required to justify the purchase price?
How much margin improvement is embedded in the business case?
What has to go right for the growth and synergies embedded in the price to materialize?

Execution capability

Can the organizations actually execute the transformation implied by the acquisition?
Are the required capabilities available?
Can systems, processes, products, and organizations be integrated without disrupting the underlying businesses?

Legal and regulatory

Could regulatory approval, intellectual property, contractual obligations, or other legal considerations materially change the economics or timing of the transaction?

Talent and culture

Will the people responsible for the acquired capability remain?
Will the organizations work effectively together?
Will we keep the critical talent whose incentives, culture, or autonomy the acquisition changes?

Customer and reputation

How will customers, partners, employees, and other stakeholders respond?
Could the acquisition disrupt relationships that are more valuable than they appear on a balance sheet?

The important point is not that every deal needs an enormous checklist. It is that the value case needs to reflect the actual thesis of the deal.

3. What creates value changes as the deal progresses

One of the most useful ways to think about M&A value is across the deal lifecycle.

The questions that matter before signing are not the same questions that matter after closing.

Before the deal

The central question is: Should we do this?

This is where strategic rationale, alternatives, target selection, valuation, and diligence matter most.

During the transaction

The question becomes: Can we structure and close this transaction without compromising the thesis?

Negotiation, regulatory considerations, transaction structure, and decision rights become increasingly important.

At signing and close

The question shifts again: Are we prepared to execute the strategy we just committed to?

This is where integration planning matters.

After close

The fundamental question becomes: Are we actually creating the value we said we would create?

This is where many organizations struggle. The acquisition is no longer a strategic presentation. It has become a business that needs to perform.

Revenue synergies need to become sales actions.
Cost synergies need to become structural changes.
Technology capabilities need to become products.
Organizations need to make decisions about what to integrate, what to preserve, and what to change.
Leadership needs to be willing to acknowledge when the original thesis is no longer holding.

From advisor to operator

My perspective on M&A has evolved through two very different experiences.

At Deloitte, I spent years advising technology companies across hardware, software, and semiconductors on growth strategies, acquisitions, restructuring, and transformation. I developed acquisition theses, worked with executives on strategic alternatives, and helped build and scale M&A capabilities globally.

At HP, I eventually experienced M&A from the operating side, including the integration of major acquisitions and synergy planning. That transition changed the way I think about M&A.

As an advisor, it is tempting to think about the transaction as the culmination of the strategy. As an operator, you quickly realize that the transaction is actually the beginning.

The real test comes afterward.

Can the combined company execute?
Can the strategy survive contact with the market?
Can the organizations work together?
Can the promised synergies be translated into actual financial performance?
Can leadership recognize when assumptions have changed?

That is why I believe the most important M&A question is not:

“Can we do the deal?”

It is:

“What will have to be true for this deal to create value — and how will we know whether those things are actually happening?”

That is where M&A value creation begins.