Predicting winners: Modern dealmakers find serious M&A players with AI

In any courtship, the key is knowing who the serious suitors are. There’s nothing worse than wasting time on frivolous approaches.

In the lead-up to a transaction, relationship-building and investigative work go hand in hand – much like dating (and can be, on occasion, equally traumatising).

As you progress through the earliest stages of diligence, you’re still working to get to know your bidders and identify areas of potential risk. The staging and sequencing of activity is critical, with certain information only disclosed after that trust has been built.

But how can you tell if a bidder is wasting your time or just a competitor in there to poke their nose around? Even if you can see some synergies and alignment upfront, how can you establish trust with external parties?

Collating different metrics and interpreting their results will help you make faster and more effective decisions in response to bidder behaviour, including rises or falls in interest, to keep the deal progressing.

Comprehensive data room reporting provides visibility into different facets of the due diligence process, allowing dealmakers to make their own determinations regarding bidder engagement. Many dealmakers would agree that by six weeks into a deal, after viewing reports and taking calls, they have a gut instinct around who is hot (or not). Now, a machine can get them to that point within a week.

Get certainty by day 7 of the deal

Leading-edge artificial intelligence (AI) approaches are enabling dealmakers to go straight to the serious bidders.

Ansarada’s AI Bidder Engagement Score is a machine learning algorithm trained on tens of thousands of deals to help you understand bidder behaviour and intentions, with up to 97 per cent accuracy by day seven of a deal. It allows you to validate your gut instinct with real data, and crucially, validate it while it still has time to affect the outcome – whether that involves challenging the bidder’s interest or removing them from the deal entirely.

“Being able to see the trends week on week to assess whether they are improving helps us eliminate time wasted on disengaged bidders, maintain competitive tension, and focus our efforts on the ones most likely to convert, so we can get the deal done faster,” says Jacinta Martino, corporate development administrator for Galaxy Resources Limited in Western Australia.

“It's fantastic to have all of this technology and automation that makes our lives so much easier as investment bankers,” said Julian Garratt, Director at Perella Weinberg Partners in New York. “The AI Bidder Engagement Score that I've seen in transaction processes I've been involved in has actually been very effective in predicting who the future successful party in the [bidding] process will be. It's had an almost 100% hit rate.”

Confidence and control across the full deal lifecycle

Purpose-built AI deal technology is just one feature of the new Ansarada Deals™, a total transaction management solution incorporating new project management and workflow tools to boost efficiencies and reduce risks from the earliest stages of deal strategy all the way through to post-deal integration. By centralising all activity and processes within a single platform, dealmakers are able to surface insights, make earlier, more accurate predictions, and drive informed decision making.

“Through running deals for over 17 years, we’ve seen businesses and their advisers struggle to navigate these transactions essentially in the dark, across multiple disparate systems. The new Ansarada Deals™ provides businesses and their advisors not only with powerful AI insights on bidder behaviour, but gives them a centralised space in which to run all of these complex processes from start to finish, so they can close deals faster, remove inefficiency and drive more successful outcomes,” says Sam Riley, Ansarada founder and chief executive.