From the course: Mergers & Acquisitions

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Assess if M&A is right for you

Assess if M&A is right for you

From the course: Mergers & Acquisitions

Assess if M&A is right for you

- M&A isn't the right growth approach for everyone. Your organization has to be ready to purchase and merge with a target. There are three things to consider as you look at M&A. The deal needs to be a good strategic fit. The target must have a good strategic rationale, like access to a new market or technology, competitive denial of an asset, or capabilities, like products or people. It has to make you a stronger competitor in the market to make sense. You need the financial strength to complete the deal. This includes the ability to afford the purchase, but also pay the interest on any loans you take out to make the purchase. You also have to make necessary investments in the purchase entity or the combined entity, and be able to handle weaker business performance in the short-term, due to integration distractions. Your organization also has to have a culture that can work well with the acquired company's culture. If the acquisition target is cost-focused and you're innovative and…

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