Merger & Acquisition Retirement Plan Support
A successful merger or acquisition starts with a comprehensive strategy
Mergers and acquisitions (M&As) are fast-paced, complex transactions requiring a thorough review and attention to detail through numerous stages. This can be a challenge for many organizations when also remaining focused on the day-to-day business goals.
As the acquisition process moves along, an in-depth review of a company’s retirement plan can often be overlooked. A company that understands the M&A process and has a benefits integration strategy is more likely to be successful in merging with or acquiring a new company.
USI Consulting Group’s (USICG) experienced team of ERISA attorneys, actuaries and consultants will work with you to complete a thorough due diligence to identify risks and liabilities, compliance issues and any other hidden retirement plan related issues – helping your organization mitigate risk and incremental costs. Our comprehensive M&A support will guide your organization through all phases of the transaction, including;
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Strategy design |
Pre-acquisition due diligence | Negotiation & structuring | Integration | Employee communications |
Understand the complete picture
Having a clear understanding of the business will help to build the strategy for how the employee benefits will be integrated moving forward. As the buying organization, you will want to know:
- All aspects of the organization’s industry, including lines of business, geography and management
- Management’s objectives
- Workforce profiles
- Whether the M&A transaction will be one of best practice or a clear buyer/seller transaction
Uncover hidden liabilities
In addition to knowing the goals of the business in preparation to move forward, it is important to determine how the transaction is going to be structured. Whether the buyer will acquire the assets or stock of the target company will affect virtually every aspect of the deal. USICG can offer retirement plan due diligence support for both types of transactions.
Benefits of thorough due diligence of a retirement plan prior to an acquisition:
Mitigates the risk of potential corrective contributions or IRS tax penalties post-acquisition
Saves the buyer from potential future compliance issues
Consider four retirement plan options
There are four options to consider when determining the outcome for all the existing qualified and/or nonqualified plans. Reviewing these options closely early on is crucial for the buyer, as a decision for the fate of the plans must be decided prior to closing the transaction. Your USICG team is equipped to walk you through each option and reach decisions based on your organization’s desired outcome.
Set a game plan to move ahead
After a complete review and comparison of the seller’s and buyer’s plans, your USICG team will provide a report that presents findings, recommendations and options for the merged plan, giving your organization guidance as you move forward in the process.
Following the completion of the transaction, USICG also helps ensure implementation of the plan that was set as part of the pre-acquisition due diligence. This often includes:
USICG's support during M&A transactions can be key to
helping organizations mitigate risk and incremental costs
Case Study: Due diligence support through acquisition
A medical technology company in the Midwest was seeking a service provider with the expertise needed to guide it through a pending acquisition. The company had limited Human Resources and Finance support and would need to rely heavily on the selected vendor to help them execute each step in the process. Based on its exceptional track record in the M&A marketplace, USICG was selected to help the company successfully execute its vision.
Due diligence services provided by USICG consultants included:
Coordinating the launch of new 401(k) and nonqualified deferred compensation (NQDC) plans at an accelerated pace to meet an aggressive go-live date.
Conducting a recordkeeper Request for Proposal (RFP) and determining the best customized fit for the client.
Creating a low-cost investment menu* spanning all major asset classes while simplifying retirement plan participant decision-making.
Writing a new 401(k) document with adaptable language to achieve the goals of the client.
Providing plan design benchmarking information to ensure the client’s retirement plan would be competitive in the industry.
Case Study: Due diligence support through acquisition
A medical technology company in the Midwest was seeking a service provider with the expertise needed to guide it through a pending acquisition. The company had limited Human Resources and Finance support and would need to rely heavily on the selected vendor to help them execute each step in the process. Based on its exceptional track record in the M&A marketplace, USICG was selected to help the company successfully execute its vision.
Due diligence services provided by USICG consultants included:
Coordinating the launch of new 401(k) and nonqualified deferred compensation (NQDC) plans at an accelerated pace to meet an aggressive go-live date.
Conducting a recordkeeper Request for Proposal (RFP) and determining the best customized fit for the client.
Creating a low-cost investment menu* spanning all major asset classes while simplifying retirement plan participant decision-making.
Writing a new 401(k) document with adaptable language to achieve the goals of the client.
Providing plan design benchmarking information to ensure the client’s retirement plan would be competitive in the industry.
How USI Consulting Group can help
USICG’s experienced M&A experts are available to guide your organization through the complete retirement plan due diligence process, helping you mitigate risk and incremental costs. Through our parent company, USI Insurance Services, we have employee benefits and property & casualty experts to help with your holistic benefits offering.
To learn how we can help your organization, please contact your USICG representative or reach out to us at information@usicg.com.
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