Top 6 Identity Security Risks in Mergers and Acquisitions (M&A)

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Mergers and acquisitions (M&A) create massive opportunities for growth — but also for cybersecurity chaos. During the complex process of integrating two organizations, identity systems are often the weakest link. Overlapping directories, mismatched IAM tools, and rushed access provisioning can open new doors for attackers.

Research shows that the risk of a cybersecurity incident doubles during M&A activity, and 65% of executives later regret an acquisition due to post-merger security issues. Identity security — who has access to what — sits at the heart of that risk.

Based on Unosecur’s client engagements and industry research, this guide explores six critical identity-related risks that frequently emerge in M&A, along with practical steps to mitigate them.

1-Disparate Identity Systems and Tools

No two organizations have identical identity infrastructures. One may use Azure AD and Okta, while the other relies on legacy on-premises Active Directory. Authentication policies, provisioning workflows, and security controls can differ drastically.

These mismatched systems make post-merger integration complex. Without a unified IAM strategy, authentication gaps, policy mismatches, or duplicate user directories can create blind spots that adversaries exploit.

Mitigation Strategy

Before integration, conduct a comprehensive identity posture assessment using Identity Security Posture Management (ISPM). Align both IAM environments under a consistent framework and implement a phased unification plan supported by IAM Ops to reconcile policies, roles, and access models.

2-Elevated Identity Attack Surface

Mergers multiply identities — and therefore risk.
Two sets of users, admins, service accounts, and SaaS integrations merge into one ecosystem, doubling the potential attack surface.

Every new privileged account becomes a high-value target, and shadow identities (like orphaned admin credentials or dormant service accounts) can easily go unnoticed. Integrating third-party systems and cloud platforms only compounds the problem.

Mitigation Strategy

Deploy Privileged Access Management (PAM) to strictly control admin-level accounts and enforce least privilege. Pair it with Identity Threat Detection and Response (ITDR) to gain real-time visibility over unusual logins or privilege escalations across the new, combined environment.

3-Unverified and Provisional Access

During M&A integration, speed often takes priority over security. Temporary accounts, shared VPNs, and cross-company credentials are issued rapidly — sometimes without full identity verification or multi-factor authentication (MFA).

These “temporary shortcuts” introduce long-term risk. Over-privileged or unverified users can unintentionally (or maliciously) access sensitive systems, especially when onboarding contractors or third-party consultants.

Mitigation Strategy

Apply Just-in-Time (JIT) and Just-Enough Access (JEA) principles through automated IAM workflows. Ensure all new accounts are MFA-enforced and continuously monitored using ITDR tools to detect behavioral anomalies. Even under time pressure, no access should go unverified.

4-Role Ambiguities and Segregation of Duties (SoD) Conflicts

Post-merger environments often blur reporting lines and functional boundaries. Employees might inherit overlapping responsibilities or dual roles that conflict with Segregation of Duties (SoD) principles.

For example, an employee could gain permissions to both request and approve financial transactions, effectively bypassing internal controls. During M&A transitions, such conflicts can lead to fraud, data misuse, or compliance violations.

Mitigation Strategy

Use Identity Governance and Administration (IGA) systems to automatically detect and flag SoD conflicts. Implement regular access reviews involving HR, Compliance, and IT to ensure that role-based access remains clean and auditable. Continuous identity governance should be baked into the integration roadmap, not treated as a post-merger afterthought.

5-Regulatory and Compliance Vulnerabilities

Merging two organizations means combining compliance obligations — often across different jurisdictions. One entity might follow GDPR, while the other aligns with HIPAA, SOX, or ISO 27001.

If compliance frameworks aren’t harmonized early, data protection controls can fall through the cracks. This misalignment may result in cross-border data exposure, audit failures, or regulatory fines.

Mitigation Strategy

Engage compliance officers and legal teams at the due diligence stage. Map both organizations’ regulatory landscapes, and adopt the most stringent standards across the combined entity. Tools like ISPM can map existing controls to frameworks (GDPR, ISO, SOC 2, etc.) to maintain alignment. Conduct regular post-merger audits to ensure sustained compliance.

6-Inherited Security Compromises and Breached Credentials

Perhaps the most dangerous M&A risk is buying someone else’s breach.
The acquired company might already be compromised — either by an active attacker or due to historical security weaknesses.

A classic case is Marriott’s 2016 acquisition of Starwood, where attackers had been inside Starwood’s systems for years, stealing data from up to 500 million guests. The result: lawsuits, fines, and lasting brand damage.

Mitigation Strategy

Conduct forensic security assessments and credential audits before and immediately after the merger. Deploy ITDR and ISPM solutions to detect hidden compromises or risky accounts. Ensure contractual clauses provide legal recourse if undisclosed breaches surface later.

A simple rule: assume the target company is compromised — and hunt for proof to the contrary.

Key Takeaway: Don’t Buy a Breach Along with the Business

Identity security is one of the least visible yet most critical risks in any merger or acquisition. As organizations merge infrastructures, they must also merge trust — and that trust must be earned, not assumed.

To safeguard the deal and the data:

• Start identity integration early during due diligence.
• Enforce Zero Trust principles across both organizations.
• Automate IAM operations to minimize human error.
• Continuously monitor and govern access post-merger.

A well-executed identity security strategy doesn’t just prevent breaches — it builds the foundation for a secure, unified organization that can scale confidently after the merger closes.