mna-playbook

name	mna-playbook
description	M&A playbook — deal thesis, screening, financial/commercial/legal diligence, valuation methods, real-options on deal structure, integration playbook, post-deal KPIs.
allowed-tools	["Read","Write","Glob","Grep"]

M&A Playbook

Used by mna-cockpit, cso, cfo, clo. Embodies the discipline that prevents value-destroying acquisitions: optimistic synergies, inadequate integration planning, insufficient risk pricing.

Deal-Thesis Canvas

## Deal Thesis — [Target]

### Why this target?
- Strategic adjacency (market / capability / tech / customer):
- Why now (timing thesis):
- Why us (capability fit; we can extract value others can't):

### Value-creation hypothesis
- Revenue synergies (specific, quantified):
- Cost synergies (specific, quantified):
- Capability acquisition (talent, IP, technology):
- Strategic optionality unlocked:

### Risks acknowledged up front
- Integration:
- Cultural:
- Customer overlap / cannibalization:
- Regulatory:
- Key-person:

### Walk-away criteria
- Maximum price (per share / EV):
- Maximum leverage post-close:
- Conditions that would cause us to walk:

Target-Screening Checklist

Gate	Threshold	Pass / Fail
Strategic fit (adjacency hypothesis)	Credible
Size fit (EV range)	Board-approved band
Financial health (revenue growth, margin, FCF)	Acceptable
Antitrust / regulatory red flags	None disqualifying
Reputational red flags	None disqualifying
ESG / climate posture	Consistent with transition plan
Strategic capacity to integrate	We are not already over-extended

Financial Diligence Checklist

Area	Required artifacts
Historicals	3 yr audited; LTM trailing; QoE adjustments
Quality of earnings	Non-recurring items, accounting changes, customer concentration, related-party
LTM normalization	Adjust for one-time, working-capital seasonality, stock-comp
Working-capital target	Methodology; PEG / non-PEG; what's "normal"
Debt-like items	Identified; impact on EV-to-equity bridge
Off-balance-sheet	Leases, contingent liabilities, warranties, guarantees
Tax	Audits, NOLs, attributes survivable, transfer-pricing exposure
Forecast	Re-built bottom-up; key driver assumptions tested

Commercial Diligence Checklist

Area	Required artifacts
Market sizing	TAM/SAM/SOM; growth drivers; cyclical vs structural
Customer interviews	NPS, churn, share-of-wallet, willingness-to-pay
Competitive position	Share, win/loss, moat assessment
Pricing	Realized, list, discount governance, elasticity
Sales productivity	Per-rep, ramp time, cycle length
Product position	Roadmap credibility, technical debt, AI exposure

Synergy Estimation (cost + revenue)

Type	Estimation method	Realization curve
Cost — back-office consolidation	Per-FTE × headcount × dis-synergy haircut	yr1: 30% / yr2: 60% / yr3: 90%
Cost — facility consolidation	Lease + occupancy savings	yr1: 0% / yr2: 50% / yr3: 100%
Cost — procurement	Pooled volume × pricing concession × supplier concentration risk	yr1: 25% / yr2: 75% / yr3: 100%
Revenue — cross-sell	(Customers × penetration × ARPU) × probability	yr1: 10% / yr2: 30% / yr3: 60% (cautious)
Revenue — bundling / pricing	Customer surplus realizable × conversion rate	yr1: 20% / yr2: 50% / yr3: 80%

Discount synergies at a higher hurdle than base-business cash flows (e.g., WACC + 3–5%). Revenue synergies require harsher discount than cost.

Legal & Regulatory Diligence (abbrev.)

• Corporate / cap table / equity instruments
• Material contracts (assignability / CoC clauses)
• Antitrust threshold (HSR US; EU; sector-specific approvals)
• IP (chain of title, OSS compliance, freedom-to-operate)
• Employment (top talent, equity, IP assignment, immigration)
• Privacy & data (DPIAs, breach history, cross-border)
• Litigation / regulatory inquiries
• Tax
• ESG / climate disclosures

Coordinate with clo for legal-risk matrix (fatal / remediable / acceptable).

Valuation Methods (triangulation)

Method	When	Caveat
DCF	Almost always	Sensitive to terminal value & WACC
Trading comps (EV/EBITDA, EV/Rev)	Public peer set available	Multiples expand/contract; pick cycle-adjusted
Precedent transactions	Recent comparable deals	Control premium varies; size matters
LBO	Sponsor-comparable; check max LBO price	Reveals leverage capacity, not strategic value
Sum-of-the-parts	Multi-segment targets	Allocation assumptions
Real-options	Staged structures, contingent consideration	Volatility assumption dominates

Triangulate 3+ methods. Report the range, not the point.

Real-Options on Deal Structure

Structure	When	Option value
Earn-out	Synergy realization uncertain; seller confident	Defers risk to seller; reduces upfront price
Contingent consideration	Specific milestones (regulatory, customer retention)	Aligns incentives
Staged / phased	Big-bet integration; capability acquisition	Real-options value of cancel-at-step
Minority + option to acquire	Capability we want to validate first	Pay for the option, exercise on evidence
Joint venture	Capability with shared risk; market entry	Reversibility

Integration Playbook (Day-1 / Day-100 / Year-1)

Day-1

• Combined ELT communication
• Customer communication (with chief-communications-officer)
• Employee communication (with chro)
• Legal entity / payroll / benefits continuity
• Critical-system access / security (with ciso)

Day-100

• Org-design decisions for top 3 layers
• Customer-overlap rationalization plan
• Quick-win cost synergies actioned
• Cultural integration program launched
• KPI dashboard live

Year-1

• Synergy capture vs plan (with explanation for any miss)
• Customer retention vs pre-close NPS
• Talent retention vs pre-close benchmark
• Working-capital integrated
• Systems integration milestones hit
• Post-close review to board

Post-Deal KPI Tracker

KPI	Baseline	Target	Actual M3	M6	M12
Synergy capture ($M)
Customer retention (% of pre-close ARR)
Top-100 talent retention
Cultural-integration index
Systems-integration milestones (% hit)
Operating margin (combined)

Output

M&A artifacts saved to output/mna/. Each deal gets a full dossier; see mna-cockpit.md.