Testing the Defenses: Cybersecurity due diligence in M&A

12 July 2016

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As the importance of cybersecurity rises in the corporate environment, it has become vital for potential acquirers to assess the IT systems of M&A targets. Companies are increasingly aware of the need for cybersecurity due diligence, yet they often lack the proper personnel to conduct thorough analyses, according to a new study by West Monroe Partners and Mergermarket, Testing the defenses: Cybersecurity due diligence in M&A.
 
West Monroe Partners, a North American business and technology consulting firm, commissioned Mergermarket to interview North America-based senior M&A practitioners to provide insight on the complexities and challenges of cybersecurity due diligence in the acquisition process.
 
Highlights from the report include:
 
  • 80% of respondents said that cybersecurity issues have become highly important in the M&A due diligence process.
  • More than a third (40%) of acquirers said they had discovered a cybersecurity problem at an acquisition after a deal went through, indicating that standards for due diligence remain low.
  • 70% of respondents said compliance problems are one of the most common types of cybersecurity issues uncovered during due diligence, while 40% said a lack of comprehensive security architecture is also common.
 
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