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Industry : Corporate Finance, Merger & Acquisition Functional Area : M&A
Activity:  3 comments  185 views  last activity : 07 06 2010 20:18:04 +0000
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History shows that only 1/3rd of Merger & Acquisition were successful in the past. Why acquisition is not so successful? Why companies could not obtain maximum advantage of acquisition? As we see, after the downturn, M & A activity is going to be in great demand due to expanding market in emerging economy & consolidation activity in western economy in order to obtain economies of scale. 

What shall an organization do before & after an acquisition so that they can get maximum advantage of acquisition?

A pivotal assumption of merger & acquisition is that acquisition will both preserve and create value during the integration process. If acquisition has to fuel future growth and to ensure that every deal captures and preserves optimum value, acquisitions must be managed like any other mission-critical function-with processes and platforms that span all stages of the deal lifecycle.

In order to get maximum advantage of acquisition M & A activity of organizations should be divided into 4 parts-

Corporate Activity

Pre-Deal Activity

Deal-In-Process Activity

Post-Deal Activity

Corporate Activity

Formation of Internal M & A Department

When companies increase the number and pace of their acquisitions, the biggest practical challenge most of them face is getting not only the right people but also the right number of people involved.........

Please follow my blog URL link to read the complete article. . . . . .

http://deepakagrawalblog.wordpress.com/2010/02/16/how-to-get-maximum-out-of-an-acquisition/

 Top Comment : Mathew Cherian   | 02 16 2010 17:54:51 +0000
I feel M&A activities of the past few years were not succesful because they were ment to only enhance the technology base of companies. Look at Cysco, they acquired 100's of small companies with new technology advantage for the future. Their acquisitions won't accrue to the bottomline unless their products which are to be marketed comes to market. Before 90's acquisitions and mergers used to be succesful. Now the new liberal economics has ushered in new philosophy for M&A which will take long time to materialise.
 
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3 comments on "How to get maximum out of an Acquisition"
  Commented by  RAMESH KANDADAI, Principal Consultant, ARM Consultants    | 02 19 2010 08:33:21 +0000
Off late the manner in which merger and acquisitions are handled have ended up demoralizing the work force in the company that is being bought out. This results in serious attrition in the purchased outfit which in turn is loss of experience and product knowledge. Organizations should manage the dissemination of information on M&A activities much better so this does not happen. You may end up buying the company but what use is it when all the product knowledge has left the company due to attrition. Dissemination of information about M&A activities is an all important aspect of such activities. Unless this is handled properly, it sets a poor tone for the post M&A atmosphere. Recovery from such a negative atmosphere will take a lot more effort for the post M&A control. Decisions pertaining M&A must be handled with extreme care as these decision cast long shadow! They actually leave a lasting impact on the company that buys and the one that is bought.
  Commented by  Namrata Pathak, Accounts Manager, American Express    | 02 17 2010 11:21:36 +0000
Merger and acquisition strategies are extremely important in order to derive the maximum benefit out of a merger or acquisition deal. Through market survey and market analysis of different mergers and acquisitions, we need to drive the best strategies to get maximum benefits out of an acquisition.
  Commented by  Mathew Cherian, Research Associate/Analyst, Western Michigan University    | 02 16 2010 17:54:51 +0000
Rating : +1 
I feel M&A activities of the past few years were not succesful because they were ment to only enhance the technology base of companies. Look at Cysco, they acquired 100's of small companies with new technology advantage for the future. Their acquisitions won't accrue to the bottomline unless their products which are to be marketed comes to market. Before 90's acquisitions and mergers used to be succesful. Now the new liberal economics has ushered in new philosophy for M&A which will take long time to materialise.
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