Need to Perform a Corporate Merger & Acquisition? We’ll show you just how to do it – in only six steps!
As with everything in today’s competitive workplace, when it comes to business acquisitions and mergers, we only tend to hear about the highly successful ones that left the participant endowed in public endorsement, effective success and profit that came from it. Yet, we rarely hear stories about the ones that failed during the process – which are a common occurrence in the business. There are countless details and reasons why a Merger and Acquisition process may not go well and end falling apart before getting completed, but luckily there are steps we can take in order to avoid the mistakes that lead to that.
When considering Merger and Acquisition as a new stepping stone of your business’ future, it is crucial that you understand the importance of this complex process and consider any variables before getting involved in it. M&A transactions that have been well planned out, and effectively executed and completed, will certainly without a shadow of a doubt leave all involved with great value and most usually – substantially increased profits. On the other hand, overlooking some important steps of the process and not starting it planned out carefully enough can result in the whole process ending as a failure, while leaving all participants with a significant loss of time, value and potential profit. We’re here to make sure this does not happen to you. Consider the following steps and keep them in mind to ensure your merger and acquisition process yields the best and most effective results possible.
1.Check your company’s finances
Before taking any concrete steps in M&A process, it is of greatest importance that you thoroughly check your company’s current financial situation. First of all, it is crucial that you determine whether you have the financial liquidity to successfully begin and effectively complete the M&A process. Once you’ve confirmed that you do, make sure that the capital structure of your business is able to sustain the additional strain that the M&A is going to impose. If it’s not, talk to your financial consultants on the options you have in regard to funding strategies and debt financing which can give you enough resources to ensure the M&A process successful completion.
2.Make sure your team is experienced and qualified enough to complete a successful M&A.
Human resources, their skills and experience is the most important and critical factor in the success of any business and transaction. Your M&A success is largely dependent on the vision, experience and qualifications the team assigned to complete it has. Make sure that your team is able to handle the transition while handling any unexpected challenges that may appear along the way.
3.Plan your M&A carefully and set clear objectives and goals for the company to achieve once the process if finished successfully.
Asses your goals, values your business promotes and thoroughly examine the position of the future goals and objectives you have for your business. Once you have a clear vision and plan for what you want to do with your business in short, medium and long term, it will be much easier managing and securing a successful M&A transaction that will benefit everyone involved.
- Proceed with Caution and Detailed planning
When considering a M&A transaction, just looking whether the numbers will add up usually is not enough. A careful analysis of the final medium and long term goals you want to achieve with the merger alongside with thorough consideration of the reasons, plans and options that are compelling you to take this step is crucial. It’s also important that you make sure that your management and staff and the managing team of other company are 100% on the same page. Share your common future goals, see whether they are flexible, open and creative as well as whether you are going to work well as a team. Never fixate on only one option at all costs and always remain open and explore all of the various possibilities available to you.
- Create a Transition Team
As said before, M&A transactions can get really complex, challenging and unpredictable. This is why they require a strong, experienced and highly qualified leadership to lead the companies through all the obstacles they may face in the process. Always stick to your detailed plan (see the previous paragraphs), work together, share your goals and challenges, and keep your expectations high and your team motivated.
- Have a clear vision for the transition and the company’s future.
When it’s time to complete the merger process and incorporate mutual business operations, cultures and processes, it is important to re-visit the official beginning plan and consider creating a new, post-transition one. It may take some time for the M&A to finalize and your situation, goals and objectives may have changed during the process. Keep your new company motivated and focused, always striving to reach the new goals and heights of success, while always having a plan with clear vision in sight.
Of course, there is an endless amount of variables that may impact the success of a business acquisition. This is why it is vital to have an experienced team in place to handle the process as well as the guidance of a qualified, experienced transaction attorney will help handle every aspect of the merger in a more effective and secure manner.
Bailey Law Firm is staffed with knowledgeable and experienced business law and transactions attorneys on all aspects of expansion, acquisition, sale, transfer and dissolution.
If you have questions about the merger and acquisition process please contact us, or contact Jess Bailey at: (832) 510-2900