The motivation to acquire is as plentiful and different as is buyers, sellers and kinds of deals. The goal of an acquisition is to increase your competitive advantage by gaining:
- New Capabilities: adding new products and services.
- New Customers: expanding the customer base, increasing revenues with higher earnings.
- More resources: adding new and fresh talent, leveraging technologies or processes.
- Or Eliminating Competition: purchasing a competitor, capturing economies of scale.
Entering the acquisition process is much like starting a marriage in that it involves a major commitment and is best embarked upon after carefully considering your long-term goals.
The current Merger & Acquisition Market has swung to a buyer’s market; companies with valuable capabilities, customers and resources are available under favorable prices.
Acquisitions are risky business; certainly a buyer beware endeavor! Review your strategic plan, assemble your team, prepare a time and responsibility checklist, find and evaluate Sellers, conduct due diligence and close the deal. Don’t be afraid to walk away from an acquisition that does not meet your criteria!