Making M&A work
Tuesday, July 21st, 2009WARNING – you are probably the only person in the room who wants a lower price (sellers, banks and accountants are working on percentage fees).
Five Rules to make a Merger Work:
1. The right Purpose
- Fills obvious gap in portfolio and organic growth is too slow
- Vertical integration – protect vulnerable supply chain (Kodak and silver mines)
2. The right Partner
- Partner with compatible – goals, culture & systems
3. The right Price
- No biding war
- Egoless purchase – not to build the biggest, should be looking to build the best
4. The right Plan
- Where are the integrations (e.g. Leave R&D separate but merge Sales.)
- Identified the synergies
5. The right Process
- Who – does the merger
- What will it achieve
- How long is the plan – what is the target for the merger.
