http://dataroomplace.blog/dealroom-vdr-deal-management-software-option
It’s not a secret that M&A is a great way for businesses of all sizes across the world to accelerate their growth. However, the process of acquisition is rife with potential pitfalls that could cause acquired businesses to lose value. Taking time to follow these four steps to an effective acquisition will help you avoid common pitfalls and ultimately make your next acquisition a successful strategy to increase growth.
1. Develop a strategy for acquisition.
One of the most frequent reasons for unsuccessful acquisitions is poor planning. If you create an acquisition plan from the beginning, you will ensure that your company is maximising its value and remains on the right path to achieve your M&A goals.
This involves creating a list M&A targets and then narrowing the list by using search criteria. These could include industry sector valuation, deal value, market share, and operational scale. Corporate development teams can use numerous resources to identify M&A companies that are worth considering, such as online sources such as DealRoom and LinkedIn trade journals or industry associations; and databases of investment firms and private equity firms.
2. Create a team to oversee the M&A process.
It is crucial that management teams establish an organization headed by an executive at the top who can oversee the M&A from start to finish. This is essential to ensure that the strategic intent of the acquisition isn’t lost along the way and that the process of integration is smooth and efficient. It is also important to have human resources experts on the M&A teams to calculate compensation and benefit expenses, as well calculate actuarial estimates of financial liabilities and pensions.