Best practices in M&A to create shareholder value

Mergers and acquisitions are highly complex where right planning and execution is essential during the entire M&A lifecycle including pre-deal planning, due-diligence, deal structuring, integration planning and execution. Today, many companies see mergers and acquisitions as an instrument which help them increase the customer reach, reduce cost, achieve scale. drive revenue growth, diversification and positioning in the market which in turn increase the shareholder value. A recent research suggests that the success rate of M&As is approximately 40 – 50% only 1. M&As provide opportunity to the organizations to be more productive while leveraging the existing assets.

Below are some of the best practices that companies should leverage to achieve the maximum out of M&A activities:

-Performance improvement of target company by helping them develop their business

-Remove excess capacity from industry by consolidation

-Faster time to market for target’s / buyer’s products

-Faster means to acquire new technologies / skills and at a lower cost

Another important factor to consider before M&A is to assess the capability to undergo such programs and identify key stakeholders and their accountability within the organization.