Acquisitions can have an enormous impact on growth. However, the outcome of an acquisition can vary depending on how it is carried out. The most successful acquirers use the same set of steps to guide them through the M&A process.
The first step in the M&A dataroomplace.blog/successful-acquisition-management-process/ process is defining your motivation for acquiring. This will create an outline for all subsequent decisions and actions. Acquirers with clear motives will avoid common mistakes in acquisitions such as chasing several targets, rushing to close a deal without completing due diligence, and paying too much for a company whose culture and strategy are not a good fit.
Once you have a clear reason first, the next step is developing detailed search criteria for prospective companies. This will include factors like industry focus geographic location, financial health, and intellectual property aspects. The best M&A teams use a variety of sources for identifying potential candidates, ranging from databases to online portals, and then make their list more specific to “A” and “C” deals.
After a lengthy and often difficult due diligence process, the next step is to craft a narrative for the company. This is the narrative that will be presented to customers suppliers, customers, and competitors, so it’s crucial that it’s a positive one. Additionally, it’s important to consider the effect that an acquisition could have on your P&L and balance sheet.