5 Steps for a Successful Acquisition

Acquisitions are an essential business process that can have significant impact on growth. The outcomes of an acquisition will differ according to how well http://dataroomplace.blog/dealroom-vdr-deal-management-software-option the deal is carried out. Most successful buyers follow an established set of guidelines to guide them through the M&A process.

The first step in the M&A process is to determine the motive behind an acquisition. This will provide an understanding of your future actions and decisions. Acquirers who know their motives are more likely to avoid common pitfalls of acquisitions, like chasing multiple targets, rushing into a deal before due diligence is complete and paying too much for a company that is likely to be a bad fit in terms of the culture and strategy.

If you have a clear goal, the next step is to create specific search criteria for potential target companies. This will include factors like industry focus and geographical location, financial health and intellectual property factors. The most successful M&A firms make use of many sources to determine potential candidates. These include databases and online portals. They then narrow their list down to “A” or “C” deals.

After a long and demanding due diligence process the final step is to develop a company narrative. This is the story you tell your clients suppliers, customers, and even competitors. It is therefore crucial that it be positive. It’s crucial to consider the impact an acquisition will make on your P&L, and balance sheet.