Adequate preparation is extremely important; in fact, we recommend that before engaging in the M&A process, companies do two things:
- Educate themselves on the major components of the M&A process by taking a one-day Master Class in M&A For Acquirers.
- Ensure that their corporate strategy is up to date and realistic, and matches with where the company wants to go. Watermark offers both services.*
If the acquirer does not have a full appreciation of all of the processes involved in M&A (Master Class in M&A) and if it does not have a clear vision that is pulling it in a particular direction (strategy), then the likelihood of achieving ROI goals through acquisitions dwindles. Many infrequent acquirers rely heavily on their investment banker, attorney, and accountant to guide them through a transaction. If the leadership team had been educated in all of the M&A processes, had a clear strategy, and implemented M&A processes with a comprehensive view, then their M&A success would be greater.
When preparing for the actual acquisition, we walk the client through the decision making process on how to determine who to include on their M&A team (both internal and external professionals). We help them identify markets that are attractive to consider expanding into, and then help them prioritize those markets. We then help them identify and prioritize numerous acquisition target companies, by conducting due diligence on each company to determine which are leaders and which are outliers. Finally, in the preparation service offerings, we advise the client on approach techniques to increase the likelihood of engaging in meaningful conversations with top acquisition prospects.
* Watermark also offers a Master Class in Valuation & Synergies, which delves deeper into these two important areas of the Master Class in M&A.