Treasury and M&A: Integrating Liquidity, Systems and Risk in the Post-Deal Phase

January 6, 2026

Treasury and M&A: Integrating Liquidity, Systems and Risk in the Post-Deal Phase

Mergers and acquisitions represent transformative moments for any organization. Deal teams invest months negotiating terms, conducting due diligence, and securing regulatory approvals. Despite meticulous planning, a significant proportion of M&A transactions fail to deliver the anticipated value. Research consistently shows that poor post-deal integration—particularly in financial operations—is a primary driver of underperformance.

In this context, Treasury is often overlooked. Engaged late in the process, treasury teams are expected to absorb immediate impacts on liquidity, funding, systems, and risk management without adequate preparation time. The consequences of this delayed involvement can be severe: trapped cash across jurisdictions, suboptimal debt structures, unhedged foreign exchange exposures, and operational disruptions that persist long after deal completion.

This article examines why treasury integration deserves strategic priority in M&A planning and provides a practical framework for CFOs and treasury leaders navigating the post-deal transition.

The Strategic Imperative: Why Treasury Cannot Wait

The traditional M&A playbook prioritises legal structuring, tax optimisation, and accounting treatment. Treasury considerations are frequently deferred until after closing, creating a reactive rather than proactive integration approach.

This timing creates predictable challenges. Treasury teams inherit a complex landscape without the visibility or tools needed to manage it effectively. Multiple banking relationships, disparate cash management structures, and inconsistent risk management practices must be reconciled under time pressure whilst maintaining business continuity.

The financial implications extend beyond operational inconvenience. Delayed treasury integration can result in higher financing costs, increased earnings volatility, and missed opportunities for synergy realisation. For organisations with global operations, these challenges multiply across currencies, regulatory environments, and legal entities.

Cash and Liquidity: Establishing Visibility and Control

Post-acquisition liquidity management presents immediate challenges. The acquiring company must rapidly establish visibility over cash positions across what may be dozens or hundreds of newly acquired bank accounts, each operating under different mandates and local practices.

The complexity intensifies when considering structural constraints. Local funding arrangements may carry restrictive covenants. Cash pooling structures may not extend across the newly combined entity. Dividend restrictions or thin capitalisation rules may limit cash repatriation. Without comprehensive mapping and analysis, significant amounts of cash can remain trapped in lower-priority jurisdictions whilst the group incurs unnecessary external borrowing elsewhere.

Effective liquidity integration begins with comprehensive cash mapping. Treasury teams must quickly identify all bank accounts, understand signatory arrangements, and establish reporting lines. This foundational step enables informed decisions about banking rationalisation and cash concentration.

The next phase involves assessing opportunities for structural integration. Can the target’s entities be included in existing cash pooling arrangements? Would establishing an in-house bank improve efficiency? Are there opportunities to optimise working capital and reduce external funding requirements? These questions require careful analysis of legal feasibility, tax implications, and operational complexity.

Parallel to cash integration, debt rationalisation demands attention. Target company debt may carry different covenants, maturities, and pricing than the acquirer’s facilities. Treasury must evaluate whether to refinance, repay, or maintain existing arrangements based on group funding strategy, market conditions, and transaction costs.

Throughout this transition, maintaining adequate liquidity buffers remains essential. Integration inherently creates uncertainty and potential disruption. Conservative liquidity planning during the initial post-deal period provides resilience against unexpected challenges.

Foreign Exchange and Interest Rate Risk: Closing the Exposure Gap

Acquisitions frequently introduce new currency exposures, interest rate profiles, and market risks. Without structured integration, these exposures can remain unidentified and unmanaged during a critical period.

The challenge stems from several sources. Target companies may have operated with limited hedging, relying instead on natural offsets or accepting volatility. Their risk management practices may not align with group policies. Local treasury teams may lack the systems or expertise to measure exposures accurately. In some cases, conflicting hedging instruments may exist across entities, creating inefficiencies and potential accounting complications.

The first priority involves comprehensive exposure identification. This extends beyond simple transactional exposures to include translational balance sheet risks and economic exposures embedded in business models. Treasury must understand not only the current state but also how exposures will evolve as integration progresses and intercompany structures change.

With exposures identified, treasury can assess alignment with group risk management policies. This includes evaluating hedge ratios, permitted instruments, tenor guidelines, and counterparty frameworks. Where target practices diverge significantly, transition plans must balance immediate risk reduction against operational feasibility.

Integration into centralised hedging programmes offers efficiency benefits but requires careful execution. Legal entity rationalisation, establishment of appropriate master agreements, and system connectivity must precede full integration. During the transition, clear governance ensures that hedging decisions align with group objectives whilst respecting local operational requirements.

For organisations employing hedge accounting, acquisition integration presents particular challenges. Hedge relationships may be disrupted by changes in corporate structure or cash flow forecasts. Treasury must work closely with financial reporting teams to assess whether existing designations remain effective and plan any necessary re-designations.

Systems and Process: Building the Operational Foundation

Treasury system integration rarely receives the attention it deserves, yet it fundamentally determines long-term operational efficiency and control effectiveness.

The acquired company may operate a treasury management system incompatible with the acquirer’s platform, or may manage treasury operations through spreadsheets and email. Banking connectivity may rely on different channels and security protocols. Payment workflows and approval hierarchies may not align with group standards. Reporting frequency, formats, and data quality may vary significantly.

A phased integration approach mitigates disruption whilst establishing control. The initial phase focuses on visibility and reporting. Even before full system integration, treasury needs consolidated views of cash positions, exposures, and key metrics. Interim reporting solutions—potentially manual during the first weeks—provide essential information for decision-making.

The second phase addresses transaction processing. Payment capabilities must be maintained without interruption, requiring careful planning around bank account transitions, signatory changes, and system cutover. Treasury must coordinate with banking partners, IT teams, and business units to sequence changes without disrupting operations.

The final phase pursues optimisation. With stable operations established, treasury can implement standardised processes, enhanced automation, and improved controls. This includes segregation of duties, dual authorisation workflows, and audit trails appropriate to the combined entity’s risk profile.

The First 100 Days: A Structured Integration Roadmap

Successful treasury integration requires structured planning that balances immediate stabilisation with longer-term optimisation.

Days 1-30: Stabilise and Secure

The first month post-closing focuses on ensuring business continuity and establishing foundational visibility. Treasury must secure liquidity, verify funding availability, and establish basic cash reporting. Critical risks and exposures require immediate identification, even if comprehensive management solutions await later phases.

This period involves significant stakeholder engagement. Treasury must establish relationships with local finance teams, understand operational practices, and identify key dependencies. Banking partners need notification of ownership changes, and signatory arrangements require updating to ensure payment capabilities remain uninterrupted.

Days 31-60: Align and Integrate

The second month shifts toward structural integration. Treasury works to harmonise policies and governance frameworks, ensuring consistent approaches to risk management, counterparty selection, and control standards. Cash management structures begin integration, with legal and operational groundwork laid for cash pooling or sweeping arrangements.

This phase involves defining the target operating model. What functions will be centralised versus retained locally? How will reporting lines and decision-making authority be structured? What systems and platforms will the combined entity employ? These decisions shape subsequent implementation efforts.

Banking relationships undergo rationalisation. Redundant accounts close, core banking partners are confirmed, and consolidated credit facilities may be established. Treasury collaborates with procurement and accounts payable teams to update vendor banking details and payment routing.

Days 61-100: Optimise and Embed

The final third of the 100-day period focuses on implementing long-term structures and measuring integration success. Funding and hedging strategies move from transitional arrangements to optimised solutions aligned with group strategy. Controls and reporting frameworks become embedded in standard operations rather than requiring special handling.

Treasury begins demonstrating integration value through improved efficiency metrics. Working capital optimisation, reduced funding costs, and enhanced risk management contribute to synergy realisation. Performance measurement frameworks track progress against integration objectives.

Lessons from the Field: Common Integration Challenges

Experience from numerous integration projects reveals recurring challenges that treasury teams should anticipate.

Underestimating Timeline Complexity

Treasury integration invariably takes longer than initially planned. Legal entity restructuring requires regulatory approvals. System migrations demand extensive testing. Banking relationship changes follow documented procedures with fixed processing times. Building realistic timelines with contingency periods prevents rushed implementations that compromise control or create operational risk.

Insufficient Stakeholder Engagement

Treasury integration cannot succeed in isolation. It requires active collaboration with legal, tax, IT, financial reporting, and business unit teams. Early and consistent engagement ensures alignment, identifies dependencies, and facilitates coordinated execution.

Neglecting Change Management

Acquired entities often have established practices and local treasury expertise. Integration plans must respect institutional knowledge whilst implementing group standards. Clear communication about changes, rationale, and timing helps maintain morale and operational continuity during transition.

Data Quality Assumptions

Acquired company financial data may not meet group standards for accuracy, completeness, or timeliness. Treasury should validate data quality early and invest in cleansing efforts before building integration solutions on potentially unreliable foundations.

Making Treasury a Strategic Partner in M&A

Treasury integration represents more than an operational necessity—it is a value preservation and value creation activity. When engaged early with adequate resources and executive support, treasury contributes materially to deal success.

For CFOs leading M&A transactions, several principles drive effective treasury integration:

Engage Treasury During Due Diligence

Treasury should participate in financial due diligence, assessing target cash management practices, banking relationships, and risk management sophistication. This early involvement identifies integration challenges and informs deal valuation and structuring decisions.

Resource Adequately

Treasury integration demands significant effort beyond business-as-usual responsibilities. Dedicated project resources—whether internal teams or external advisors—ensure integration receives appropriate focus without compromising ongoing operations.

Prioritise Quick Wins

Whilst comprehensive integration takes months, certain actions deliver immediate value. Early cash visibility, basic exposure hedging, and streamlined payment processes demonstrate progress and build momentum for longer-term initiatives.

Measure and Communicate Success

Integration value should be quantified and reported. Reduced financing costs, improved cash conversion cycles, and enhanced risk management represent tangible contributions to deal economics. Communicating these outcomes reinforces treasury’s strategic importance.

Treasury as a Strategic Partner in M&A

The statistics on M&A success rates remain sobering. Many transactions fail to deliver promised value, with post-deal integration challenges cited as primary factors. Within this broader integration landscape, treasury plays a disproportionately important role relative to the attention it typically receives.

Liquidity management, funding optimisation, and risk mitigation are not peripheral concerns to be addressed after closing. They are fundamental to realising deal rationale and protecting shareholder value. The complexity of modern treasury operations—spanning multiple currencies, jurisdictions, and financial instruments—demands proactive planning and skilled execution.

For organisations contemplating M&A transactions, the message is unambiguous: treasury must be at the table from the beginning, not summoned after the deal closes. With proper planning, adequate resourcing, and executive commitment, treasury integration transforms from a source of risk and complexity into a driver of deal success and strategic value creation.

Treasury integration is not simply about “making things work” after a deal. It is about protecting downside and unlocking upside.

When treasury is engaged early—during due diligence and deal structuring—it informs:

  • valuation assumptions;
  • financing strategy;
  • integration complexity and cost;
  • risk-adjusted return expectations.

For CFOs and boards, this represents a shift in mindset: treasury is not a post-close function, but a pre-close strategic advisor.

FTI Treasury Perspective

At FTI Treasury, we support organisations across the full M&A lifecycle—from pre-deal diagnostics to post-merger optimisation. Our role is not to replace internal treasury teams, but to:

  • accelerate integration timelines;
  • provide independent challenge and specialist expertise;
  • ensure treasury becomes a source of value creation rather than post-deal friction.

As M&A environments grow more complex and capital markets remain volatile, the organisations that succeed will be those that recognise treasury integration for what it truly is: a strategic capability, not an operational clean-up exercise.