Mergers and Acquisitions
Fragmented markets with lots of small players lead to consolidation opportunties.
Reasons
- Can't raise finance
- Limited growth
- Acquired
Selling yourself is harder work, lots of preparation.
- Establish commercial relationships.
- Want buyer to take pricing risk
- Need an internal champion in buyer
Getting bought
- Command better price and terms.
- King making potential, buyer goes to main competitor
- Accelerated growth with less risk
Deciding
- Psychology
- Life situation
- Age, appetite for risk
- Prior experience
- New challenge
Risk Adjusted Outcome
Risk tolerance and practicality of money.
Value * Probability = Expected Outcome
Highest expected outcome won't sell.
Need to find the most believable story to quanity expected outcome to provider value to stakeholders.
See DCF Analysis
Buy Side Profiles
- Strategic Buyer - Preferred
- Private Equity - Don't pay as much, disciplined
- Another Private Company - Equity hire, scale
Pre Merger
Due Diligence
Post Merger
- Culture fit: Team integration
Process overlap.
What routine checks and balances needs to be setup to manage this process optimally?
Thoughts
Questions
Obstacles
Opportunties
Decisions
Tools
What are best of breed tools that match jobs to be done?
Schema
What are related concepts to master?
Links
What useful education resources are available?