Acquisitions are an essential business process that has significant impact on growth. However, the outcome of an acquisition may vary depending on how it is carried out. The most successful acquisitions employ a set of consistent steps to guide them through the M&A process.
The first step of M&A is to define the motive behind the acquisition. This will give you a framework for all future actions and decisions. Acquirers who are clear on their motives are more likely to avoid the common pitfalls that arise from acquisitions, such as trying to pursue multiple targets, jumping into a deal before due diligence has been completed and paying too much for a company that is likely to be a poor fit in terms of both strategy and culture.
After you have identified your purpose then the next thing you need to do is to create specific criteria for finding potential target companies. This will include things like geography, industry focus, and financial health, as well as intellectual property aspects. The top M&A firms make use of a variety of sources to identify potential candidates. These include online portals and databases. They then refine their list down to “A” or “C” deals.
After a dataroomplace.blog/top-10-finance-bloggers/ long and often difficult due diligence process the next step is to craft a corporate narrative. This is the narrative you will tell to clients suppliers, customers, and competitors. It’s crucial that it be positive. It’s also important to think about the impact that an acquisition can have on your P&L, and balance account.