Author: Janina Galeazza | Leanne Donohoe
In March 2025, industry leaders gathered for Deloitte Australia’s inaugural HR DealMakers event to discuss one of the most pressing challenges in mergers and acquisitions (M&A): talent retention.
A recent Deloitte study found that voluntary attrition increases by over 30% during M&A transactions1. With M&A activity expected to surge in the coming year, the ability to retain key employees is increasingly recognised as a crucial factor for deal success.
For Buyers, retaining top talent in the acquired company is essential for preserving institutional knowledge and key relationships, and ensuring the organisation has right people it needs to run. At the same time, the Seller has a vital incentive to retain key staff to maintain operational stability and protect value before and during the transaction.
How to Approach Retention in M&A
The discussion at the event reinforced the importance of balancing both offensive and defensive retention strategies.
Defensive strategies (primarily financial incentives) are highly effective in the short to medium term, with less than 5% of recipients leaving before their awards vest2. However, their impact is inherently temporary, as employees may depart once the financial benefits are realised.
On the other hand, offensive strategies (primarily non-financial incentives) focus more on long term retention by strengthening the intrinsic employee commitment. Examples include career progression, development opportunities, and increased benefits.
Reflecting on their experiences, panellists shared their lessons learned:
Lessons learned |
Description |
---|---|
Retention starts early. |
Companies should plan for retention from the due diligence phase, rather than treating it as a mid-transaction afterthought. Retention is not one-size-fits-all. A tailored approach is essential—invest time in understanding the employee base at a granular level and continuously iterate retention efforts to address unique needs. A broad, generic strategy risks missing critical motivators for different workforce groups. |
Retention is for the long term. |
Efforts to retain talent shouldn’t stop at Day 1; they must be embedded into the broader integration strategy. Sustainable retention comes from engagement, career opportunities, and cultural alignment well beyond the initial transition period. |
Don’t plan for perfect. |
No retention plan will be universally well received—there will always be noise and differing opinions. Start with a well-grounded strategy based on clear convictions and business priorities and be prepared to adjust as needed while staying focused on long-term objectives. |
Empathy goes a long way. |
Whether on the buy or sell side, leadership quality plays a critical role in successful transactions. The ability to listen, read the room, and navigate uncertainty with empathy fosters trust and engagement. Soft skills, such as emotional intelligence and active communication, should not be underestimated in driving a smooth transition. |
Looking Ahead
The HR DealMakers event highlighted that successful talent retention in M&A is not just about keeping people—it’s about keeping the right people, in the right roles, with the right support. Organisations that approach retention holistically are best positioned to effectively navigate the road to completion and beyond.
To learn more about HR M&A best practices in our future HR DealMakers sessions, please submit your expressions of interest to attend via HRdealmakers@deloitte.com.au
Sources:
1. Deloitte. (2023). Playing for keeps: Retaining talent after a deal.
2. Deloitte. (2022). M&A retention survey: Understanding the role of retention in deal success.