What do you think the up and down arrows you carved

#What do you think the up and down arrows you carved how to

Are we handing over a full, operation SAP system, or just handing over flat files. You also need to know as much information as possible about what ERP they are running, or how they would like to receive the data.

Selling to a competitor is completely different that selling to a business completely unrelated to what you do.

The buyer needs to try and understand the seller, and vice versa.

Who is the buying/selling party: this is really a two-way question.

Know this early on, can give you a huge leg up on understanding a planning for the execution of the carve-out. This means, that all relevant transactional and historical data needs to be handed over in case of future audits. On the other hand, in a share deal the buyer is purchasing stock ownership of the company, so they are taking on not only future, but past and present liabilities as well. This means, there is no need to hand over any historical data that isnвЂ™t necessary to maintain day-to-operations running. In this scenario, the buyer is only taking on future liabilities from the execution of the deal. Think of a logistics provider getting rid of their truck fleet to focus on brokerage or a huge soda producer selling one of their brands including inventory, production facilities and warehouses. In an asset deal, as the name implies, a company is selling assets for cash.

Asset vs Share Deal: this really should be the first question asked as it has huge implications with regards to data, and hence the level of complexity.

In this case it is critical to understand a few different things:

But when dealing with traditional two-party M&A deals, there will always be two systems (sometimes more in complex scenarios, but this is besides the point). Well, this is not true for ALL carve-outs since some can be strictly internally driven like system splits or internal restructuring. A 5% late penalty on a $200M deal is $10M вЂ“ which may be about 10x the cost of the IT portion of the project.ДЄnother unique aspect of carve-outs is that you are always dealing with separate systems: the seller and the buyer. But without flawless execution you could potentially run into career-ending penalties or extremely high additional cost depending on what has agreed on in the TSA. This makes it extremely easy to overlook. The overall cost of delivering such a project is insignificant compared to the overall deal. M&AвЂ™s are 100% business driven, so no one in the room even thinks twice about IT complexities when discussing multi-million (sometime multi-billion) dollar mergers or acquisitions. This is of course anecdotal, but IвЂ™ve had similar conversations in the past to know this was not just a one-off call. There is no room for failure, or my job is on the lineвЂќ she said. That 90-day timeline was what concerned her the most.

#What do you think the up and down arrows you carved how to

It was now up to her to figure out how to separate the systems, segment the data accordingly, and deliver all this within a short 90-day timeframe. Turns out, the CFO had just walked into her office with an M&A contract stating they had sold a business unit. I always tell the story of an IT Director calling me frantically at 5pm on a Friday, asking me what I knew about SAP carve-outs. To do this, they keep the decision-making process concentrated amongst very few people (think CEO, CFO, M&A specialists and legal вЂ“ definitely NOT the CIO).

For starters, the c-suite would like to limit their exposure with the SEC. Remember how we mentioned the secretive nature of M&A deals in last weekвЂ™s blog post? Well, this is a big deal. Okay, so now we know what an SAP carve-out is (see my first blog post here), letвЂ™s spend some time trying to understand what it is about them that makes them so unique when compared to other, more traditional SAP projects.