As Private Equity firms look at making add-on-acquisitions in Europe for their portfolio companies, they should consider HR outsourcing, as it can help in assessing and mitigating hidden compliance risks, scaling faster as well as planning and modelling human capital costs. These factors will help build portfolio value.
Outsourcing HR services allows PE and portfolio company management to focus on the strategic success of the acquisition while offering tangible and valuable advantages at every stage of the investment.
More insightful Due Diligence, Pre-close
Sharing information around the deal at hand with an outsourced HR service provider helps identify hidden risks. A Professional Employer Organization (PEO) mitigates the employment risk for the new owner as the PEO business model assumes or shares liability for much of that risk. A PEO brings a fresh look and a skilled HR perspective to the potential acquisition. Many internal HR departments simply lack the knowledge and bandwidth to conduct this type of analysis in cross border deals.
Better Integration, Post-close
When the acquisition has been concluded, many decisions associated with the integration of the new company, their teams, processes and programs can lead to frustration, or at least confusion, thus slowing down the integration process. An outsourced HR provider can offer the necessary infrastructure to address a number of these issues. This will again free up time of management to focus on other success factors. Many mergers, especially those involving two companies from different countries, fail because of a lack of cultural integration and communication. A local Outsourced HR professional can help address these issues.
EuroDev, the European Business Development Group, assists North American companies grow in Europe. The company offers a unique combination of buy-side M&A support, outsourced HR and Outsourced Sales services. Perfected over 20 years of service and supporting more than 250 US and Canadian companies, EuroDev offers a smooth transition, at every step of the European expansion process.
For more information, contact Gerben Groothuis, Managing Director EuroDev M&A at email@example.com