Four Steps for a Successful Acquisition

M&A is a potent method to help companies grow. The process of acquiring a business is fraught by potential pitfalls, which could cause acquired businesses to lose their value. Following these four steps can help you avoid common pitfalls in acquisitions and help you make your next acquisition an effective strategy for growth.

1. Plan your purchases.

Poor planning is one of the primary reasons for failing acquisitions. If you develop an acquisition strategy at the outset you can be sure that your company is maximizing value and staying in line with the goals of your M&A strategy.

This involves creating a list M&A targets, and then narrowing the list using search criteria. These could include sector of the industry, deal value, market share and operational scale. Corporate development teams can leverage various resources to identify M&A potential buyers, including online sources such as DealRoom and LinkedIn trade publications, trade journals, industry associations, and the databases of investment banks and private equity companies.

2. Form a team to lead the M&A Process.

It is important that management teams form a team headed by a senior executive who can oversee the M&A from start to finish. This is essential to ensure that the strategic intent of the acquisition isn’t dataroomplace.blog/successful-acquisition-management-process/ lost along the way and that the process of integration runs smoothly. It is also important to have experts in human resources on the M&A teams to assess benefits and compensation costs as well as quantify actuarial estimates of financial and pension liabilities.