There are several reasons to consider a merger or acquisition. Perhaps you are looking to expand into another area, you want to take advantage of tax incentives or you simply see a way to increase your assets.
Whatever reasons you may have for considering a merger or acquisition, there are a few questions to consider before pursuing the deal.
1. Why are you pursuing the merger or acquisition?
While there are many reasons to pursue a merger or acquisition, knowing the specific reasons you are pursuing one will help you find the right business or company to work with to help grow your business in the manner you intend.
2. Have you done your research?
When planning a merger or acquisition, you should research the value of the business you plan to acquire. Look into the assets, liabilities and growth potential. Do your due diligence to make sure that the benefits of the investment will outweigh the drawbacks of the transaction.
3. How will it affect leadership and employees?
Before completing a merger or acquisition, you should consider the effect on your employees. Everyone from the highest ranking member of your leadership team down to the lowest paid employee could experience a change in responsibilities or compensation when there is a major shift in the business.
If the merger results in a change in branding, make sure customers will recognize your product. If the costs of products will change, look for ways to avoid alienating loyal customers. Consider how a merger or acquisition will affect the image and reputation of your company.