M&A Best Practices: Translation as a Competitive Advantage for the Global Deal

“Time is the enemy of the deal,” is a well-known M&A imperative. To meet seller milestones and internal review deadlines, having a plan to keep the process moving quickly helps give your company an advantage over other buyers and manage risk. This is especially true of global deals, which often come with the additional task of having to review diligence materials in another language. Planning for translation early is an important part of keeping a cross-border deal on track and a great way to stay steps ahead of unprepared bidders.

Global deals are on the rise and currency fluctuations make cross-border targets more interesting for many acquirers, including many that have not before considered looking beyond their borders. With this opportunity comes the complexity of evaluating the benefits and risks of a target operating in another country. How can a globally acquisitive company manage the review of diligence materials in a time and cost efficient manner? 

Consider this: the right translation partner has been involved in similar projects and can offer valuable insights on best practices and alternatives. Consider engaging your translation company early, much like other professional service providers such as deal attorneys, in-country counsel, financial advisors, and similar specialists.

YBD Translations has developed deep experience supporting global M&A. In addition to a translation partnership with leading virtual data room provider Intralinks, the company was instrumental in supporting a multi-billion dollar global deal to promptly pass through regulatory review by translating over 20 million of words in record time. With the YBD team’s successful participation in numerous global transactions we offer these tips when it comes to hiring a translation company for your global deal:

1. Translators should always be subject–matter experts. With thousands of documents to review, lawyers and other decision makers don’t have time to try to decipher the meaning of an awkward translation because the translator does not know the difference between a hedge and shrubbery. 

2. A translation service provider should know the lay of the land. Due diligence should be an area of specialty as time is of the essence and ability to scale a translation team can’t be “learned on the job.” 3. The company should have the right technology to streamline and manage the process. Technology can be used to speed translation and identify documents (e.g. boilerplate contracts) that may not require translation from scratch to manage expense.

4. The company should be a global service provider, not a small local agency. Global providers have the manpower to keep a project moving and respond to the deal team around the clock. They can scale teams to any size to accommodate surges in demand and production can “follow the sun.” Having teams of translators working in different time zones keeps projects rolling 24 hours a day, effectively tripling daily output.5. In-Country counsel is indispensible to review critical items and render opinion incorporating local law and governing language. However, it’s noted that some corporate counsel, for Sarbanes-Oxley reasons, want their internal team to review 100% of materials to be fully-familiar with all diligence items – making efficient translation even more critical. Similarly, internal review of translated materials enables your team to identify items of concern unique to your business, IP, and competition.

6. Don’t fall into the trap that your translation service provider is a black box: words in and words out. They can provide meaningful guidance to your M&A team. For example, develop a game plan to help prioritize what documents should be translated first to meet internal review milestones and go/no-go decision points.

The translation of due diligence materials is a critical aspect of global M&A. When intelligently managed, the language barrier won’t stand in the way of promptly closing a deal. To the contrary, knowing how to efficiently translate the data room can help mitigate deal risk and provide a competitive edge over other bidders.