An M&A, also known as mergers and acquisitions, is the process where companies or assets are consolidated together. There are several reasons why an M&A might be performed, from improving economies of scale to wiping a rival business out of the equation.
Even though the advantages are there for all to see, there’s a startling statistic regarding mergers and acquisitions: 70% of M&A transactions fail to reach their expected strategic and financial results.
Due to this, it’s imperative that an in-depth and carefully considered integration plan is put into place. If you’re a newcomer to the world of M&A and not sure where to start, here’s a quick guide on what needs to be done to ensure success.
Know what is expected of the deal
It’s a straightforward point, right? You should be well aware of why you are performing an M&A with another business, and the type of undertaking this will require. Nevertheless, it can be surprising the amount of business owners that don’t possess a crystal-clear goal with this type of deal.
Do you know how the combined business will look and perform? Do you know how they will be fully integrated together? If you don’t have answers to these simple questions, executing a successful M&A is going to be highly unlikely.
Use the right platform to complete transactions
When you think about the importance of the documents and information sent during an M&A, it makes sense to keep these as safe as possible. This can be done by completing the transaction through Virtual Data Rooms.
By using a platform that has the latest security certification, due diligence is met when completing the transaction. A virtual data room isn’t just about security, either. With the right platform, the transaction process can be streamlined significantly, while 24-hour support is available at every stage.
Begin the integration immediately
The deal is done. Yet that was only the start. Now you have legal control of the other business, it’s essential you develop and utilize an implementation plan. This plan will not only help with accurately communicating the overall goal of the integration, but it will also get the process going immediately.
It’s important to start the integration as soon as possible for several different reasons. Ultimately, the quicker it’s done, the quicker it will be less of a disruption.
Understand how it could affect your business culture
Your business will operate with its own personality and culture. The other business you’re merging with will also have a culture and style of its own. Now what happens when you bring the two together?
It could go in one of two ways. The more preferable way is that the cultures mesh together and everyone gets on well. The other way, however, is that there’s a culture clash – and this could have disastrous consequences for your business. If staff members become upset about the situation, this could be detrimental to their morale, productivity, and even willingness to remain with the company.
