As demand grows for succession plans and business exits across the Southeast, many founders and business leaders are considering sale or private equity investment as a way to provide their business with a route for growth, and allow them to de risk. While investors are focused on revenue multiples, leadership continuity, and cultural fit, business risk can damage a deal. Given the reputational and revenue impact, cyber risk now has the potential to damage or even destroy a carefully engineered deal.
Buyers are digging deeper than the balance sheet
Because cyber risk is still relatively new for many businesses it is not always taken seriously. This is not something which can be easily fixed during a diligence process, it needs to be in place before the deal starts.
This was brought home during a recent MD Hub group session, where Russ McKenzie of NTrust (link) voiced his surprise that many business owners still don’t take cyber threats seriously. “If there’s one issue that can simultaneously damage revenue and reputation,” he said, “surely this is it.”
It’s a timely warning. You only need to look at the news or try to order on-line from one of the UKs most famous brands to realise the impact this could have, 3 months loss of on-line profits would have a huge impact on any business. Cyber security is no longer a back-office concern—it’s now a front-line issue in due diligence. For larger firms with internal IT teams, the risk is often managed through firewalls, compliance protocols, and employee training. But smaller businesses, especially those preparing for sale or succession, may be dangerously underprepared.
What a cyber breach really costs in a deal
The consequences are real. A data breach before or during an M&A process can significantly reduce buyer interest or lead to additional scrutiny, delayed timelines, costly remediation demands or loss of the deal. Worse still, it can trigger regulatory fallout or reputational damage just when the business needs to appear stable and secure.
And yet, cyber is often ignored in pre-sale planning. Founders focus on financial performance and customer relationships—critical, of course—but underestimate the buyer’s concern with operational risk. Today’s acquirers want assurance that they’re not inheriting hidden vulnerabilities, whether technical or cultural.
Positioning for success in a risk award market
If your business is planning a future sale or succession, cyber should be on your list of priorities.
It’s worth remembering that M&A is rarely just about numbers. It’s about trust, readiness, and reputation. And nothing undermines those faster than a cyber incident. Whether you’re aiming for a strategic merger, private equity investment, or a founder exit, overlooking cyber risk is no longer an option.
From risk to readiness
The market in 2025 is good and we are completing some high quality deals for clients. DMH Stallard has a team of 7 regional M&A Partners operating across the South East and we are all busy. One of the key factors we see in deals is that buyers/investors are risk averse, focussing heavily on diligence.
For a further discussion on how to ensure a successful merger or acquisition, or for any other corporate law questions, please get in touch or call Jonathan Grant +44(0) 7912 087173
