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Mergers and acquisitions cybersecurity and compliance risk assessment.


Cybersecurity due diligence in M&A

Mergers and acquisitions (M&A) can create strategic business advantages and fuel economic growth. Combining companies can be a risky proposition for both entities on many levels. The target company’s cybersecurity posture can have a major impact on the acquiring company’s present value, and on the potential unknown liabilities the acquirer may be assuming.

While companies thoroughly study a potential company for merger or acquisition in many areas, cybersecurity and compliance are often overlooked. This shortfall can be a costly mistake.

What is a cybersecurity due diligence assessment?

Sword & Shield’s Due Diligence Assessment provides a high-level overview of risk associated with your organization’s pending merger or acquisition as it relates to cybersecurity and compliance. This service helps you to do the following:

  • Make better decisions from whether to proceed with the merger or acquisition, to planning how to do so.
  • Accurately plan for expenses associated with both entities’ security postures.
  • Avoid damage of reputation that could result from an unwise purchase.

Sword & Shield partners with you through this facilitated self-assessment to help you evaluate the security programs in place, discover potential security and compliance gaps, and address compatibility issues.

Is compliance status a mergers and acquisitions concern?

Yes. Achieving compliance can be expensive; not being compliant and accruing fines can be detrimental. Sword & Shield’s expertise in compliance frameworks such as HIPAA, PCI, NIST, ISO, GDPR and more helps us to ascertain the target company’s status and determine what it will take to achieve compliance.

Who can benefit from a cybersecurity due diligence assessment?

Sword & Shield works with capital investment companies, corporate law firms, and banks potentially funding these endeavors to assess the risks associated with compliance, privacy, security, and governance of any and all data that could be deemed sensitive.

Cybersecurity due diligence for M&A discovery

Cybersecurity due diligence for M&A allows our experts to provide the following:

  • Information that may point to undisclosed cybersecurity problems
  • Insight into the extent of remediation needed and estimated associated costs
  • Information on the risk(s) related to discovered issues on which to base executive decisions
  • Awareness of indications there are compliance gaps
  • Understanding of implemented security frameworks and architecture
  • Insight into IT department approaches and style
  • Awareness of breaches, and if and how they were addressed

As any company is susceptible to cyberattacks, all parties engaged in M&A transactions should treat cybersecurity and compliance due diligence as an imperative stand-alone requirement. Fortunately, cybersecurity due diligence is becoming an M&A best practice.

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