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M&As have come a very long way in recent years. M&A deals continue to be on the rise – 2015 saw the value of mergers and acquisitions hit a record global high of £2.79tn and the upward trend is projected to continue throughout 2016 and beyond as confidence improves across boardrooms worldwide. But according to recent Harvard Business Review research, about 70 per cent to 90 per cent of acquisitions fail to deliver on planned value. To put things in perspective, 2015 alone saw close to $4.7tn in declared deals with the average size of deals being $125m. With M&A activities seeing close to a 27 per cent average annual growth, there is lot more riding on a need to succeed than it ever was. From fuelling competitive advantage and increasing market share, helping new product partnerships to enter new markets and even create new service models – M&A’s have become the new reality in today’s business landscape.- Essential tips to execute an M&A deal with a manufacturing firm
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- How to avoid an M&A nightmare
Get the due diligence right
It is imperative that a strategic move like an M&A is supported by a thorough due diligence. It goes without saying that potential buyers will perform financial due diligence in order to value the deal and determine their bid strategies. But experience suggests that bosses who have performed proper supply chain due diligence as a part of their M&A strategy tend to have an 80 per cent more chance of success. Though there are no standard rules to carrying out a due diligence, a standard process should have four goals: (1) Strategic outlook: Why the merger – (growth / capital efficiency)? How the supply chain is expected to be affected by this merger?Share this story
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