So we have talked before about choosing which is right for you, merging or acquiring. If want it to go well, though, you’ve got to roll up your sleeves and do your homework, and this is what we’re addressing today – how to make the process as seamless as possible, how to anticipate possible hiccups. It’s a simple yet crucial step in making sure that you come to the table well prepared.
It is worth making the point that mergers and acquisitions are critical for the sustainable and profitable growth of corporations – even today – not only for their core business activities but also for the future value generating activities. With that said, it is also important to realize that on average nearly 70% of mergers and acquisitions fail to meet or exceed the forecasted expectations set forth by the involved parties.
Therefore, the most important of all the necessary keys to a successful post-merger or post-acquisition integration is that of a well thought-out and planned pre-merger/acquisition Due Diligence. Successfully planning and initiating this kind of process requires sound strategies and a deep understanding of the operational, financial, legal and cultural issues of the associated individuals and company(-ies).
Doing your pre-(insert M/A) due diligence can go a long way in eventually determining the values that are to be attributed to the target for the acquisition as well as the amount one is willing to invest for such a merger.
As such, working in advance with the auditors, appraisers, tax advisors and attorneys to form a complete and detailed target profile allows the concerned parties to be as fully informed as possible when making any decision.
Certainly there are several other factors that go into the process of completing a merger or an acquisition, but the most important factor is to be as fully informed as you can be prior to going through with it in order to hedge as much post-merger/acquisition risk as possible.
Make sure that you make an informed decision in all cases,
All the Best,