Depending on the business logic for a transaction - economies of scale, extensions of
product portfolio, market entry, acquiring new competencies, ... - the conceptual approach may be very different. Nevertheless in order to improve the chances for a successful transaction as well as subsequent integration, a few elements should be taken care of at
this stage already :
- Keeping in mind, that 'doing the deal' is the first step only, as the acquired company will have to be integrated afterwards as well, it is strongly advisable to define the integration approach already at the time when the strategic blue-print for an acquisition is being defined. Otherwise, the risk is [too] high that the values the company is acquired for, cannot be preserved and consequently not achieving the goals aimed for.
- Involve the designated integration manager in the Due Diligence already - at least into the operational, cultural and HR-related due diligence.
- In addition, make sure sufficient attention is paid to the interfaces between the different - functional or regional - Due Diligences, such that no crucial issues 'fall between the cracks'.
- For doing the valuation highly sophisticated methods are available, putting it into a 'quantitative frame'. But it may still be advisable to look at the valuation from a 'qualitative' / top-down perspective as well, in order to make sure the acquisition
will generate a sufficient return to justify the time and money to be invested into the acquisition planned. When using a DCF, particular care has to be paid to the Terminal Value included in the valuation.
- Deal Structuring allows to model from a contractual perspective whatever the different partners are aiming at, but increasing attention has to be paid to compliance in terms of tax adherence and merger-control (anti-trust).
Overall, make sure the transaction has a robust design and the business plan allows for some delays in the process as well as for some degree of financial underperformance without putting the entire transaction at risk.
The major transactions in this context were :
- M&A Transaction across several countries
- M&A Transaction after achieving a Turnaround
- Private Equity Investment Management
- Set-up of a JV in China
- Carve-out of a large division from an international technology group
Next to these more complex transactions, I was either executing or being involved in more than 25 transactions, covering both Buy-Side and Sell-Side, as well as Share Deals and Asset Deals.
In addition, I've also attended formal traning related to Mergers & Acquisitions at Harvard Business School and the New York Institute of Finance.