Private company mergers and acquisitions (“M&A“) is the merging of two or more private companies or similar entities. Private company M&A deals with the buying, selling or acquiring of shares in private companies and/or businesses, and the dividing and combining of these business entities.
Private company M&A falls within the category of business law services.
Stages in the M&A Process:
- Considering the attributes of a target
- Selection of target
- Decide on a pricing model
- Valuation of the target
- The transaction
- Assessing the outcome
The pre-M&A phase:
Success lies in identifying and applying the correct financial model, to evaluate the true value. Bear in mind that things are often disguised, so be conservative with your analyses.
Engage in dialogue and research to acquire as much information as possible about the target company. A mere snapshot of the financial statements will not suffice. Synergies with existing businesses must also be evaluated.
The post-M&A phase:
The post-acquisition phase constitutes the integration of the business into the existing structures, applying processes and control, and integrating the staff and other stakeholders .
09 February 2012