Nov 19, 2024
M&A is a powerful method for companies to expand. However, the process of acquisition is prone to pitfalls that can cause acquired businesses to lose value. Making sure you follow these four steps to an effective acquisition will help you avoid common pitfalls and make your next acquisition a winning strategy to grow.
One of the most common reasons for failed acquisitions is http://dataroomplace.blog/top-10-finance-bloggers inadequate planning. By establishing an acquisition plan at the outset, you can ensure that your business is maximizing the value of its acquisition and keeping in line with the objectives of your M&A strategy.
This involves creating a list M&A goals and then reducing the list by using search criteria. These could include things such as the industry sector size, deal size market share, deal size and operational scale. Corporate development teams can rely on different sources to identify M&A targets, including online sources such as DealRoom and LinkedIn, trade journals and industry associations, as well as the databases of investment banks and private equity firms.
2. Set up a team that will manage the M&A process.
It is essential that management teams establish an executive team headed by a top executive who can supervise the M&A process from start to completion. This is essential to ensure that the purpose of the acquisition isn’t lost in the process and that the process of integration is seamless. It is also crucial to have experts in human resource on the M&A teams to calculate the cost of benefits and compensation as well as quantify actuarial estimates of pension and financial liabilities.