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Case study: Shieldpay for M&A

Streamlining a £1 billion M&A deal

October 2023

Deal overview

Acquisition of an independent insurance company 
High value : £340 million cash and £660 million equity 
High volume: 406 payees involved 
Cross-border: Spanned multiple jurisdictions and required FX for payouts in 8 different currencies 
THE CHALLENGE

International payee management and compliance risk

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  • Due diligence burden: KYC (Know Your Customer) of all the payees compliance was a non-billable task for the legal firm and would have been exceptionally time-consuming given the complexity of the deal. 
  • Risk in payment handling: Managing payments to 406 payees was a significant risk, requiring reliance on in-house client account functions and finance teams, which involved highly manual and long drawn-out processes. 
  • FX challenges: The law firm lacked foreign exchange capabilities, making currency conversion for international payees highly costly and complex. 
THE SOLUTION

Automated processes and global disbursement

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  • Payee outreach: Shieldpay initiated communication with payees to explain the process and the required actions from all stakeholders, effectively managing a high volume of correspondence to coordinate transactions involving hundreds of parties. 
  • Efficient data collection: Required personal data from stakeholders was collected through online forms, ensuring ease and convenience, with all data stored in a centralised location. Leveraging Shieldpay's Verify offering, all KYC checks for the 406 contracted payees were conducted by Shieldpay. 
  • Funds management: The payments provider received funds from three different parties and disbursed the funds to all payees within a specified timeframe. 
  • Currency choice: Payees were offered the option to receive payout in their preferred currencies, thanks to a strong partnership with an FX provider offering highly competitive FX rates. 
THE OUTCOME

A supercharged payment experience

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  • Time and cost savings: The law firm saved hundreds of hours of administrative time, allowing its legal teams to focus on higher-value, billable legal work. 
  • Enhanced communication: Shieldpay created a dedicated channel for handling payee inquiries to streamlined the process. This supported the law firm's efficiency and provided a more responsive and centralised communication platform, ultimately enhancing the client experience. 
  • Streamlined payment journey: By partnering with a technology-enabled solution, the client benefited from a streamlined payment process, reducing the complexities associated with a large, multi-currency transaction. 
  • Efficient payout: The deal's payout was seamless and fast, despite its complexity, ensuring that all parties received their funds within the agreed-upon timeframe. 

Summary

Outsourcing to Shieldpay enabled the law firm to overcome significant challenges associated with a complex M&A deal, resulting in time and cost savings, improved communication and a streamlined payment process. This case study exemplifies how a technology-enabled solution can add value to a complex transaction, benefiting all parties involved. 

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