Pitfalls And Key Areas To Focus in Mergers & Acquisitions
Published by slang April 21st, 2006 in Mergers & AcquisitionsThe success rate in Mergers & Acquisitions has been very appalling. It’s is estimated that only one out of 10 M&A is successful. It’s therefore very important that we need to be very vigilant at each stage of the M&A process so that we are able to address those potential pitfalls revealed in the Survey of Forbes 500 CEOs
Pre-Deal planning stage
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Potential Pitfalls · Incompatible marketing system · Need to spin off or liquidate too much |
Key Areas to focus on to Prevent failures · Formulating strategy · Developing the business case · Reviewing alternative options · Identifying targets · Initial assessment |
Doing the deal: execution stage
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Potential Pitfalls · Acquirer paid too much |
Key Areas to focus on to Prevent failures · Evaluating the target · Structuring the transaction · Price assessment · Supporting negotiations · Due diligence · Regulatory approvals |
Post-merger integration
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Potential Pitfalls · Inability to manage target |
Key Areas to focus on to Prevent failures · Establishing the strategic framework · Developing integration plans · Communications · Implementing plans · Establish key performance metric in the form of a balanced scorecard |
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