In all the commotion surrounding mergers and acquisitions, it could be easy to forget the numerous steps that must occur in order for a company to successfully pursue and complete an acquisition. The fact is, a successful M&A process requires time and thoughtful planning, effective communication and thorough execution.
Start with a plan. Many companies advance myriad reasons for pursuing an acquisition–purchasing international scale, filling portfolio gaps, building a third leg of the business–but the most successful acquirers have specific and well-articulated ideas about how their acquisitions will create value.
Build a team. The M&A team should consist of members of the executive management and boards of directors of both the acquiring and target companies, as well as outside experts image source who are experienced in acquisitions. This group will collaborate to establish the objectives of the sale, establish the targets for potential candidates, and screen potential buyers.
Conduct an in-depth due diligence. Buyers often ask for extensive documentation, and they often interview a variety of people prior to settling the deal. The buyer’s assessment can take several months and sellers must be prepared to provide details as soon as they can and assist in the process. When the due diligence process is completed the seller should seek the final board approval before moving ahead with the deal.
Develop plans for integration. It is essential that the buyer has a team leader that is capable of dedicating a significant amount of time and effort to the integration. The person in charge should possess the necessary skills, resources and ownership to ensure a smooth and successful transition.
