Benefits and pitfalls of mergers and acquisitions
Mergers and acquisitions happen all the time. Mergers and acquisitions can help companies grow and become more profitable. But they must be done right, else you will fail. More mergers and acquisitions fail than success. If you need help with a merger or acquisition in Florida, Fort Lauderdale, Jacksonville, Miami, Naples or Orlando, then you should consult with the team at Transworld m & A. They can help you with many aspects of the process and especially the important one of negotiations.
Merger negotiations are focused on ownership interests of the parties in the new entity. During acquisition, the negations are focused on the relative value of the respective companies.
There are potentially great benefits when it comes to mergers and acquisitions. These include
- Elimination of redundancies and related cost savings
- Increased efficiencies through economies of scale
- Entering new markets and gaining new distribution channels
- Acquiring new technologies and
- Benefiting from future potential of cutting edge products
- Gaining new employee skills without having to recruit
Maybe you want to acquire another company so that you can grow and expand your own. This means finding the potential companies that fit the bill, defining acquisition criteria, making initial contacts, collecting and analysing information, negotiating with owners and role players, making an offer, deciding terms and conditions and closing the deal. This is a complicated process and there are many risks. A business brokers an assist and guide you through the acquisition process and help you avoid pitfalls and potholes. They can help you structure a deal in the best possible way.
There are also definite risks and pitfalls when dealing with mergers and acquisitions
- Cultural clashes or incompatibilities
- Irreconcilable differences between key role players
- Apprehension among staff members
- Basic mistakes in calculations and analysis
- Funding and debt problems
- Underperformance and dissatisfaction after the fact
- No professional guidance and assistance