Nearly three-quarters of UK executives report M&A deal delays because of data loss, research finds

 
William Turvill
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One in ten M&A dealmakers are unsure about how secure their data is

Nearly three-quarters of UK executives involved in mergers and acquisitions (M&A) have admitted to deals being delayed because of critical data loss, according to new research.

These losses of information from documents, emails, devices and IT systems accounted for deals being delayed by an average of 12 days, according to Ansarada, a virtual data room provider for M&A deals.

The research also found that 11 per cent of dealmakers were uncertain their data was secure while trying to complete deals last year.

Read more: UK dealmakers: M&A deals take too long to close

As part of the research, Ansarada quizzed 520 bankers, lawyers, consultants and accountants specialising in M&A. Some 71 per cent said deals had been delayed because of data loss.

Ansarada highlighted figures from Freshfields Bruckhaus Deringer showing that 339 deals worth £256bn collapsed in the first eight months of 2014 - the highest figure since 2008.

“Considering the sensitive nature of M&A deals, it’s alarming to think that ‘data-loss’ remains such a big issue for the industry,” says Stephen Dearing, managing director of Ansarada in Europe, Middle East and Africa.

Read more: UK companies went on a trolley dash abroad last quarter

“With recent advancements in technology and security policies, dealmakers should be in complete control of the information they need to close a deal efficiently and to a tight deadline.”

Last year was widely regarded to have been a record year for global M&A. In 2015, there were highest-ever deal values in the United States and Asia and, according to Clifford Chance, more than $4.78trn of deals were announced at year end 2015.

Ansarada suggested that to avoid data losses, M&A deals should be conducted through data rooms. Email Q&As, it said, could lead to breaches of confidentiality and information leaks.

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