5 public relations strategies for mergers and acquisitions
Mergers and acquisitions are rampant in the market so don't overlook the significant role marketing and public relations can play to make your deal distinct from your competitors and better understood by your employees and customers.
Amidst all of the business uncertainty in 2020 due to COVID-19, one area that remained relatively stable was a healthy volume of merger and acquisition activity for government contractors and government IT service providers.
From the March SAIC acquisition of Unisys’ U.S. federal IT services business unit for $1.2 billion to the November 2020 announcement of $3.4 billion acquisition of Northrop Grumman’s federal IT services business by private equity firm Veritas Capital, M&A activity in the government contractor space has been buoyed by sky-high valuations, the need to acquire IT capabilities to pursue massive federal opportunities, as well as myriad factors more nuanced and specific to each transaction.
Many of these favorable trends came together to drive Peraton’s eye-popping $7.1 billion purchase of Perspecta, backed by Veritas Capital, expected to close later this year.
Washington Technology has been on the front lines of chronicling key factors driving strong M&A activity in the government space. There are undeniably numerous business, operational and financial opportunities and challenges associated with transactions of this size, but it is self-defeating to overlook the role of effective messaging, PR and social media strategy.
Below are 5 key government contractor PR strategies to consider before, during and after the transaction event.
- Develop Messaging That Tells A Cohesive Story
If you are acquiring one or more B2G IT providers or forming a new brand through a merger, there is bound to be questions and confusion from existing customers, prospects, partners, employees and other stakeholders.
If the transaction coincides with a new brand naming, customers may wonder what it means for their current levels of service and support. What is the best way to communicate new market segments (civilian, health IT, etc.) or capabilities (cyber, AI, digital transformation) enabled by the transaction? How might competitors seek to exploit the announcement by seeding doubt in the market?
External and internal messaging to ensure that everyone is working from a single playbook is vital. Messaging at the highest level must speak across B2G markets and segments; more granular supporting messages must be tailored to core markets and even individual agencies.
Finally, employees with the acquiring and acquired firms must have clarity on their own roles, and what they should be communicating to customers. Ultimately, the messaging must tell a cohesive story that brings all of the moving parts together so that it is clear why the new entity will be greater than the sum of its parts.
- Identify Right PR Strategy For Each Message
Your M&A communications strategy for B2G Tech PR should not begin and end with a press release and social posts. Those are table stakes. Nor should you condense all of your activities to a handful of days around the announcement.
There exists a long-tail opportunity to build and sustain momentum for weeks and months if you utilize a full repertoire of PR capabilities including yes, a press release but also thought leadership byline articles, targeted media pitching, customer case studies, social media content and visuals as well as internal communications.
The press release can lay out the motivation for the transaction and its benefits; byline articles can focus on establishing credibility in market areas and capabilities enabled by the transaction; rapid response/newsjacking can tie the acquisition in with prevailing B2G trends and challenges agencies face that your company can address; customer stories will help communicate the expanded capability set; while social media can amplify all of these important messages.
- Confirm The Reality; Sell The Vision
Often, B2G brands executing an acquisition or merger focus their energy on assuring customers and the market why this transaction makes sense. Publicly-traded B2G firms have an expanded set of stakeholders and shareholders who need assurances and stability. The result is many brands get so stuck in trying to justify the why that they fail to sell the what. What will this combined entity look like in 2 years, 5 years, or longer? How does it connect to past transactions and what does it signal about future market moves?
Even for stakeholder groups such as customers and investors that want stability, they also want to be excited about what the future holds. Despite what many press releases say M&A isn’t just about “synergies” – it’s about the future and growth. Sell the vision to external audiences and employees to generate enthusiasm that executives involved in the transaction no doubt possess.
- Connect The Dots
We talked about the need to tell a cohesive, forward-looking story. Don’t message the transaction in a vacuum; establish a storyline that can link past, present and future activities to M&A deals. If you are expanding cyber security capabilities, messaging should align with acquisitive and organic growth activity.
Press releases should not be episodic; if someone were to read all of your releases, blogs and other announcement mechanisms, would a compelling and tight narrative emerge? It should.
- Watch The Market
We can barely last a week without stumbling across a B2G M&A announcement. Indeed, March started out with a bang as global government services provider Maximus completed its acquisition of the Attain Federal division for $430 million.
In the press release, Maximus President and CEO Bruce Caswell checked all the boxes you would hope and expect to see for a transaction like this: connecting scale to the enablement of organic growth, digital transformation, better customer outcomes and, of course, enhancing shareholder value.
Attain Partners Chairman and CEO Greg Baroni extended the message from the why to the what: “I am excited to accelerate the growth of the Attain Partners business by providing investment capacity to realize the vision of building a next generation, asset-powered consultancy and enabling us to attract top talent, innovate market-leading solutions, and make strategic acquisitions.”
Some of these deals will involve your competitors and partners. How are they messaging these transactions? What is resonating and what is falling flat? How can you use this intel to create distinct messaging that doesn’t have you come off as a market follower simply growing to keep up with competitors, but instead as a market leader setting the pace for innovation?
Public relations and marketing efforts should be a core component in planning for the before, during and after of M&A activity.