You don’t have to integrate to succeed: How Halma creates value through autonomy, accountability and disciplined acquisition

1. Introduction

The conventional M&A story often starts with integration: close the deal, combine the businesses, capture synergies, standardise processes and realise value. Halma takes a different starting point. The FTSE 100 group has built its acquisition model around buying successful businesses in global niche markets underpinned by long-term growth drivers, preserving the qualities that made them successful and giving their management teams access to resources they can draw on when useful.

That does not mean “hands off”. It means being deliberate about where the parent can genuinely add value. In conversation with M&A REVIEW UK, Michael O’Neill, M&A Director at Halma plc, explains why disciplined selection is fundamental to long-term value creation, why cultural fit does not mean cultural sameness, and how a decentralised group can learn and scale without turning every good idea into a mandatory process.

2. The Interview

This interview has been edited and condensed for clarity.

M&A REVIEW UK: Halma is known for acquiring businesses and giving them a relatively high degree of autonomy. Where does the value creation logic of an acquisition begin: in selecting the right business, or in what happens after the deal?

Michael O’Neill: It is a combination, but it starts with the business we acquire. We look for companies that have already been very successful in global niche markets and that are aligned with our purpose. We take a long-term ownership perspective, supporting them to invest, develop their capabilities and grow over time.

Our model combines autonomy with accountability. Companies retain their identity, expertise and entrepreneurial qualities, the things that made them successful in the first place, while gaining access to Halma’s capital, experience, talent and global network.

So value creation is about careful selection, preserving what has made the business successful and then adding support where it genuinely creates value. While Halma gives its leaders autonomy to grow each business in a way that makes sense to them, it also holds them accountable for delivering results. Our decentralised model therefore depends on leaders who are comfortable with both autonomy and accountability: setting their own strategy, running their own P&L, and staying close to customers and end markets.

M&A REVIEW UK: That puts enormous weight on target selection. What makes a business a Halma business?

O’Neill: We look for strong fundamentals: alignment with our purpose, a strong position in a niche market, long-term structural growth drivers, excellent management teams and a culture that we believe can thrive within our model for decades. If those fundamentals are there, value creation becomes less about fixing the business and more about enabling it to do more.

It is not always easy to reduce that assessment to a checklist. It requires a deep understanding of the business, its market, how it creates value for customers and whether it can thrive within Halma’s model.

Ultimately, we are looking for high-quality businesses that are already creating real value for their customers.

M&A REVIEW UK: Culture is one of the hardest things to assess in due diligence. What does “cultural fit” mean when the businesses themselves are so different?

O’Neill: It definitely does not mean that every company has to have the same culture. Our companies operate in different markets and use different business models.

What we do share is a common purpose around making the world safer, cleaner and healthier. That gives us a shared direction without requiring everybody to work identically. We also look for companies where decisions are close to the customer and where autonomy can work effectively.

There is inevitably an element of judgement. The quality and openness of discussions during a process can help both sides understand whether there is a good fit. The whole conversation is ultimately about building mutual trust.

And that works both ways. We encourage owners to speak to people whose businesses we have acquired and to management teams across Halma. This gives them an opportunity to hear directly how the model works in practice. It is a mutual assessment: are we right for them, and are they right for us?

M&A REVIEW UK: That sounds quite different from the traditional image of an acquirer evaluating a target from a position of control.

O’Neill: Different acquisition models are appropriate in different circumstances. Our model works because we look for businesses with strong fundamentals and because autonomy preserves the freedom that has helped those businesses thrive.

That also means we need to be attractive to the companies we want to acquire. Some businesses may be at a different point in their development, or may want something different from an owner, and in those situations, we may not be the right acquirer.

We are comfortable with that. The model only works if there is a fit in both directions.

M&A REVIEW UK: If Halma does not rely on wholesale integration, how does it support growth after an acquisition?

O’Neill: At the outset, there are common standards that you would expect in a listed group: governance, compliance, cyber security and financial reporting, for example.

Beyond that, continuity is an important part of our model. The Divisional Chief Executive who leads the acquisition process becomes Chair of the company after completion. That means the relationship and trust built during the deal continue into ownership. They understand the business, the growth plan and the commitments made during the acquisition process, and can support the Managing Director and board as they put that plan into action.

An important part of the Chair’s role is helping the company connect into the wider Halma network. That can mean access to expertise, capital, talent and international opportunities, or connecting its leaders with people elsewhere in the Group who have addressed similar opportunities or challenges. The Chair can help the Managing Director and board navigate that network and draw on the right support at the right time.

But we do not want to prescribe how management teams should run their businesses. The most effective support is often organic: leaders draw on resources because they see value in doing so. Those relationships tend to deepen over time as peer-to-peer connections develop between companies. People help one another because they are part of the same network, sharing experience, solving common problems and learning from one another.

The operating companies still have responsibility for working out how to serve their customers, innovate, grow and run their day-to-day operations. Our job is to make resources available that may be harder to access as a standalone business, and to help companies draw on them in the way that best supports their strategy. That autonomy sits within clear expectations for performance, governance, risk management and responsible business practice.

M&A REVIEW UK: Many groups start decentralised but gradually build larger headquarters, more standards and more mandatory processes. How do you transfer knowledge without falling into that trap?

O’Neill: It starts with a fundamental belief that there is not one version of what good looks like. Our companies operate in different markets, serve different customers and use different business models. We are not trying to force people to adopt approaches that may have worked elsewhere but are not relevant to the reality of their own business.

Instead, a lot of knowledge transfer comes from creating touchpoints between people and businesses. Some connections happen naturally because there is an interface between an operating company and the Group. We also have events at Group or functional level, development programmes and training. If you bring people from different companies together for a few days, they learn together and build personal relationships. Later, when somebody has a problem or sees an opportunity, they know who in the Group might have relevant experience that can help.

The important point is that people have both the licence and the network to make those connections. Our lean structure makes it easier for leaders to build direct relationships across the Group and draw on relevant experience, without every useful idea becoming a mandated Group process. It is about giving people access to different perspectives and proven experience while leaving them accountable for deciding what is right for their business.

Talent development also creates networks. People who move through different roles or businesses build relationships across the Group. That gives us another mechanism for knowledge to travel without turning it into a central process.

M&A REVIEW UK: Is this model genuinely scalable? The more businesses a group acquires, the greater the temptation to centralise.

O’Neill: We have a scalable organisational model that has enabled Halma to grow successfully over many decades while retaining a lean centre and keeping decision-making close to customers. The key is that growth does not require us to centralise the operations of our companies.

We scale by adding leadership capacity around the portfolio rather than adding layers of central control. As the Group grows, we can appoint additional Divisional Chief Executives, each responsible for supporting a portfolio of companies. We can also evolve our sector structure when the scale and shape of the portfolio make that appropriate. We have done that before, including moving from two sectors to three when we created separate Environmental & Analysis and Healthcare sectors.

This allows us to maintain meaningful engagement with each company without changing where responsibility sits. Our companies continue to serve their customers, develop their strategies and run their businesses, while benefiting from being part of a larger Group that provides capital, governance, talent development and opportunities to share experience.

Of course, there is always a balance to strike. As we grow, we continually look at where greater scale can create value, while being careful not to undermine the autonomy and entrepreneurial culture that make our companies successful. We are not afraid to evolve the structure around the model, but we remain disciplined about protecting its core principles.

Ultimately, the model has proven itself over many years. Its continued success relies on finding the right companies, building sufficient leadership capacity around them, attracting and developing exceptional leaders, and creating an environment where they can thrive as part of Halma.

M&A REVIEW UK: Talent seems to be an important part of the value proposition as well.

O’Neill: Absolutely. Talent is one of the most important elements of our model. Because our businesses operate with a high degree of autonomy, we need leaders who are capable of running and growing businesses, making decisions close to customers and taking full accountability for performance. In a decentralised organisation, insisting on the right leadership at the company level is essential.

Smaller independent businesses can sometimes find it difficult to offer the breadth of development opportunities needed to attract and retain exceptional people over the long term. As part of Halma, individuals can build careers across different businesses, sectors and geographies while our operating companies retain their entrepreneurial culture and autonomy.

Over time, this helps us build a strong pipeline of leaders who understand how to grow businesses, develop people and operate within our decentralised model. That’s one of the key reasons why talent and succession are such important strategic priorities for Halma.

M&A REVIEW UK: You also mentioned trust with sellers. How does the way an acquirer behaves during the transaction shape the model?

O’Neill: We aim to be a straightforward and reliable counterparty. We take time to understand a business before making an offer, focus our diligence on the issues that matter, and seek to maintain the key principles agreed at the outset. Inevitably, material new information has to be addressed, but our approach is to communicate openly and work constructively towards completion.

That matters because it says something about how we want to behave as an owner. Sometimes that may mean we do not look like the most attractive buyer at the starting line. But sellers can test our claims by speaking to people who have already sold businesses to us. For us, there is a real culture of honesty and accountability behind that.

M&A REVIEW UK: Finally, what can acquirers with more traditional post-merger integration models take from Halma?

O’Neill: I would not say another model is right or wrong. Different approaches are appropriate for different circumstances.

The important thing for us is that we have a specific model and we execute consistently against it. We are not changing the model for every deal or applying somebody else’s acquisition hypothesis to a business that does not fit it.

We remain careful about selecting the right businesses. We try to preserve what has made them successful and then support them to create more value and grow over the long term. The combination is autonomy and accountability.

That consistency also means accepting that we will not always be the most attractive buyer. Another acquirer may see a very different value creation opportunity and plan to do something different with the business. That is fine. The discipline is knowing what kind of business fits your model, and what kind does not.

Fact Box: Halma plc

Business: Global group of life-saving technology companies

Headquarters: Amersham, Buckinghamshire, UK

Listing: London Stock Exchange (HLMA); FTSE 100

Purpose: Growing a safer, cleaner, healthier future for everyone, every day

Portfolio: around 50 companies

Sectors: Safety; Environmental & Analysis; Healthcare

People: more than 9,000 employees in over 20 countries

Customer reach: more than 100 countries

FY2025/26 revenue: £2.582 billion

FY2025/26 Adjusted EBIT: £594 million

FY2025/26 M&A: five acquisitions with £447 million invested

Track record: 23 consecutive years of Adjusted profit growth as reported for FY2025/26

Key Learnings: What Halma’s model suggests for acquirers

• Value creation starts before signing.

Value creation starts with a clear acquisition thesis. For Halma, that means selecting high-quality businesses that can thrive within its long-term ownership model.

• Cultural fit is not cultural sameness.

A shared purpose and compatible management philosophy can create alignment without forcing operating companies into one uniform culture.

• Autonomy only works with accountability.

Decentralisation is not the absence of governance. Halma combines local decision-making with group standards and clear performance expectations.

• Value creation can come through access rather than absorption.

The parent can create value by providing capital, expertise, talent and networks without requiring every capability or process to be centralised.

• Build networks, not only structures.

Peer relationships, leadership development and cross-company connections allow knowledge to travel without turning every useful practice into a mandatory process.

• Consistency is part of the deal proposition.

Clear and consistent ownership principles help both acquirer and seller assess fit. That consistency also builds credibility by allowing sellers to speak directly to companies already within the Group.