A merger sounds glamorous on the surface: growth, expansion, and a stronger market position. But ask anyone who has been through one, and they’ll tell you, the technical side can feel like walking through a minefield. Systems don’t align, employees can’t log in, compliance questions arise, and suddenly the “big opportunity” becomes a major IT headache. In Singapore, scams and cybercrime cost victims over S$1.1 billion in 2024, according to the police. Imagine trying to unite two companies, only to discover one of them hasn’t patched its servers in months. That’s the kind of oversight that turns a merger into a liability. So, how do you avoid IT chaos when two businesses come together? The answer is IT due diligence: a careful review of systems, access, security, and compliance before and during the merger.
Why IT Due Diligence Can’t Be Ignored
Financial due diligence is standard in any merger. But IT? Often, it gets less attention, until something goes wrong. What if the business you’re acquiring has a weak password policy or, worse, no proper backup process? Singapore’s SMBs are already highly digital. IMDA reported that 94.6% of SMEs adopted at least one digital technology in 2023. That’s positive progress, but it also means that almost every merger involves cloud apps, collaboration platforms, and data systems. Without proper review, these risks are carried over into the merged organisation. Done well, IT due diligence can also reveal opportunities, such as discovering that the company you’re acquiring has leaner processes or better analytics tools. But you won’t find them unless you ask the right questions and audit properly. That includes reviewing existing IT projects to understand what’s already in motion.
The Essential IT Due Diligence Checklist
Here’s a practical checklist for IT due diligence during a merger:
1. Build an Inventory of Assets
Every review starts with knowing what’s there: hardware, cloud accounts, domains, SSL certificates, and software. If the target company doesn’t maintain documentation, that’s already a red flag. Questions to ask:
- How much equipment is at end-of-life?
- Who owns the DNS records and SSL certificates?
- Are software licenses cleanly transferable?
2. Check Identity and Access Controls
Identity management issues often go unnoticed, until they cause a breach. Review whether accounts are managed via Microsoft Entra ID, Google, or another platform. Confirm if MFA is enforced and admin accounts are tracked. Look for inactive logins, especially those belonging to former employees. In a merger, every overlooked account is a potential security risk.
3. Email and Collaboration Platforms
Communication is one of the first pain points in integration. If one company uses Microsoft 365 while the other uses Google Workspace, a migration or coexistence plan is essential. Questions to ask:
- How are shared mailboxes archived or migrated?
- What happens to Teams or Slack channels already in use?
- Will data retention rules remain compliant?
A structured IT setup prevents employees from being stuck between systems on Day 1.
4. Security Posture and Backup Reality
This is where a lot of companies nod politely and say, “Yes, we do backups,” but when pressed, they can’t prove those backups work. The due diligence process should verify when backups were last tested, not merely whether they are documented. The same goes for penetration tests or vulnerability scans. Some SMBs test annually; others haven’t done one in years. That gap says a lot about their approach to risk. Also, consider human factors: in 2024, CSA reported that while two-thirds of Singaporeans believed they could recognise phishing, barely 13% consistently identified fraudulent messages. What does that mean? Even with strong tools in place, user behaviour is still a weak link. When you’re reviewing IT during a merger, don’t just ask for reports. Request evidence, including restore logs, incident notes, and audit trails. Blank stares indicate critical gaps.
5. PDPA and Compliance Checks
Singapore’s Personal Data Protection Act (PDPA) requires notifiable breaches to be reported within three calendar days. Many SMBs aren’t prepared for that speed. If your acquisition target lacks a process, you risk inheriting both their problems and potential fines. Look closely at contracts with third-party vendors: Do they include PDPA-compliant clauses? If data is crossing borders, are ASEAN Model Clauses or similar safeguards in place? And does the company hold the Data Protection Trustmark? That certification isn’t a cure-all, but it demonstrates maturity in data governance.
6. Vendor Contracts and IT Costs
Here’s a simple question: How many IT vendors will you be managing after the merger? If the answer is “too many,” you’re not alone. Mergers often leave companies with two MSPs, duplicate SaaS tools, and overlapping service contracts. That disorganisation drains budgets and delays decision-making. During due diligence, gather every contract into one view. Review renewal dates, notice periods, and auto-renewal clauses. This is about ensuring accountability and preventing budget waste and vendor confusion.
7. Continuity and Recovery
Most SMBs claim to have business continuity plans, but few test them. Ask when the last disaster recovery drill occurred, and what the results were. Did staff know their roles? Were systems restored within the agreed recovery time objectives (RTOs)? Review core communications: email, phones, and messaging apps. Any downtime during integration will frustrate staff and slow business operations.
Make IT a Value, Not a Liability
By the time contracts are signed, it’s too late to uncover weak security, broken backups, or vendor sprawl. That’s why IT due diligence is just as important as financial and legal checks. Often, the greatest risk in a merger isn’t the deal itself, it’s the gaps nobody thought to check. IT is a common source of those gaps. That’s where we’ve seen SMBs struggle most, and where we can help. We handle IT audits, integration planning, and ongoing support, so leaders can focus on growth instead of chasing logins or patching vulnerabilities. If you’re preparing for a merger, reach out. We’ll review your needs and create a due diligence plan tailored to your goals.
MANAGED IT ASIA, we are an IT Support, IT Solutioning and Managed IT Service Provider specializing in serving Small Businesses across Asia. Call us at +65 6748 8776 and let us manage your Small Business IT today!