The Finance World Magazine| Edition: September 2023

One of the major challenges
in cross-border M&A is the
need to hire and pay new
employees quickly. Delays
in this process can lead to increased
costs and prolong the integration
phase. An EOR, like Deel, can provide
a stopgap solution by assisting with
the migration of employees to the
acquiring company or setting up new
entities efficiently.
Companies pursuing international
M&A often incur high consultation
costs and entity set-up fees. These expenses
can add up quickly and impact
the overall deal economics. However,
by leveraging an EOR, businesses can
save significant costs on legal entity
set-up and HR staff, providing a more
operational challenges. EORs like
Deel offer a wide range of software
integrations to facilitate seamless
alignment and data sync across the
HR tech stack.
Each country classifies employees
and independent contractors differently,
leading to potential legal risks
during cross-border deals. Engaging an
EOR can help reduce the risk of misclassification
by correctly classifying
workers according to local regulations.
Acquiring a company with expat
employees may require the acquiring
company to sponsor their visas. Navigating
the visa application process can
be complex, but an EOR with in-house
immigration and mobility support can
provide valuable assistance.
strategies in place to manage IP rights
and data protection, offering a secure
and compliant solution.
Establishing a permanent presence
in a foreign country can trigger increased
tax burdens. EORs can facilitate
international expansion without
the complexities of setting up a local
entity, reducing the risk of permanent
establishment and ensuring compliance
with local tax rules.
Maintaining employees’ service history
and rights during data migration is
essential for performance management
and legal compliance. EORs with HR
technology solutions can help retain
crucial employee data and ensure
smooth transitions.
Unlocking global potential: An EOR’s
embrace transforms cross-border M&A
hurdles into triumphs.
cost-effective alternative.
Navigating complex international
compliance requirements can be a
daunting task during cross-border
M&A. Failure to comply with local
employment laws and regulations can
result in fines and penalties. An EOR
can offer robust compliance support,
ensuring that employment contracts
are generated in accordance with global
HR practices and local labor laws.
Merging or acquiring companies
often involves integrating their
tech and system synergies. However,
mismatched systems can create
Retaining talent from the acquired
company is crucial for successful
integration. Poor communication,
benefits harmonization issues, and
unclear onboarding processes can
lead to employee attrition. An EOR can
provide change management support,
tailored benefits packages, and smooth
onboarding experiences to increase
retention rates.
Cross-border M&A raises concerns
about protecting intellectual property
and data. Rehiring acquired employees
as independent contractors can
jeopardize IP rights. EORs often have
In conclusion, cross-border M&A
presents a range of challenges that
can impact the success of international
transactions. Engaging an Employer of
Record can provide valuable solutions
to reduce friction during integration,
address compliance requirements, and
support talent retention. By partnering
with an EOR like Deel, businesses can
unlock the true potential of their global
mergers and acquisitions and drive
value creation in the international
marketplace.
September 2023 www.thefinanceworld.com 47