From the course: Mergers & Acquisitions

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Avoid acquisition pitfalls

Avoid acquisition pitfalls

From the course: Mergers & Acquisitions

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Avoid acquisition pitfalls

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- There are a lot of pitfalls you might face during an M&A process. Some of the major ones are things like overpaying for the deal. The way you can mitigate that is by building a rigorous financial model and having a really good negotiating strategy. Another pitfall is poor due diligence. Put in place a rigorous diligence process. Invest time in the process and put your best people on it. You might face the pitfall of poor acquisition integration. Having a good 100-day plan and having your high performers run those integration activities can reduce that risk. You might buy something that's not a good strategic or cultural fit for your organization. Conduct a rigorous Porter's Five Forces Analysis to make sure that the acquisition is going to be a good strategic fit. Do a rigorous assessment of the acquisition target's culture and your organization's readiness to assimilate it. You might miss anticipating market reactions. We tend to think of the market as static. When we do a deal…

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