Acolad Leaders Talk About What Makes a Successful M&A

Speaking to the SlatorCon Remote December 2020 audience, Acolad Group President, Benjamin du Fraysseix, and CEO, Olivier Marcheteau, recounted how their “intense” M&A journey of the last five years allowed Acolad to emerged as a truly “multilocal company with 2,000 employees worldwide.”

What’s more, du Fraysseix said, the acquisition of AMPLEXOR immediately added USD 120m to the Group’s revenue; this, despite acquiring only 75% of AMPLEXOR. He told the audience, “It was a pre- and post-Covid deal. It was intense, but we managed to close the deal a few weeks ago. So we’re very happy that it is official. The newly formed group is now operating.”

The Acolad President then outlined the four main levers of a successful M&A strategy, namely: Staff (it brings in fresh talent); Revenue (gives the company access to Super Agency RFPs, cross-selling, etc.); Tech Capabilities (adds scalability to workflows and time to market); Financial Gains (higher revenue base, more profit and debt leverage, and a step up in EBITDA multiple valuation).

Acolad Group CEO, Olivier Marcheteau, highlighted the importance of tech integration during a merger. He said the trickiest past is ensuring the alignment of technologies across the different entities: “We’ve converged some of the CAT tools, TMS, and platforms, and we still have some work to do to get there. Because, obviously, you manage potentially complex and diverse workflows and you don’t want to break anything for the sake of aligning your technology.”

Marcheteau said they have already activated “all commercial and marketing synergies, including rebranding some of the brands.” Additionally, “The back-office synergies have been activated. We’re talking HR, Finance, IT Systems. What really matters is to make sure you don’t break anything while mutualizing, and I think we successfully drove that.”

Asked by a member of the online audience what makes an ideal M&A target, du Fraysseix replied, “We have a sweet spot: Let’s say [companies with] USD 10m to USD 100m in revenues.”

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Indicating that M&A could be a numbers game, du Fraysseix added, “I tried, maybe, 150 times in the last six years. I think we ended up with 20 to 30 very significant interests, not far from a deal. And then we ended up with 10 deals.”

On what’s next for the Group after successfully bringing together so many companies under a single organization, the Acolad President emphasized the importance of knowing when to focus and how to diversify.

According to du Fraysseix, “We are strongly dedicated to pure language services in the Group today, even though we have some adjacent business thanks to AMPLEXOR and former Acolad companies that joined the family over the last five years. But we’re still operating mainly in the written language services industry. Our next move is to go deeper into the data management value chain. Meaning not only written and oral language services, but much more.”