Mergers & Acquisitions
Fusions et acquisitions (analyse, diligence raisonnable, intégration et consolidation)

Analysis, due diligence, integration, and consolidation

Mergers and acquisitions can be very stimulating and exciting to work on, and at the same time they can also be very stressful and risky. These are crucial times for any organization when it’s imperative to mitigate all risks and ensure the important aspects of the target company are not overlooked.

Often several people at varying levels of organizations need to be involved, and in many cases, there is also a significant benefit in reaching out to external sources who have specific expertise in such transactions. We automatically think of the crucial involvement of attorneys and accountants/fiscal planners, however generally speaking and surprisingly, little thought is given to seeking external assistance on the ’’commercial side’’ of these important and often consequential transactions.

Some of the commercial aspects of the analysis involve items and tasks such as:

  • Evaluating and understanding the target company’s market and its market position
  • Studying the overall landscape of the industry in terms of history, future potential and market trends
  • Performing a deep dive exhaustive SWOT analysis of evaluating the strengths, weaknesses, opportunities, and threats
  • Evaluating the company’s products and services vs the competition related to quality, pricing, customer satisfaction, product technologies, repeat business potential, etc.
  • Exchanging with customers, key suppliers, stakeholders and selected key employees for their insights regarding the performance and reputation of the company
  • Recasting financial statements to determine if the target company yields expectations on gross profit margin, EBITDA, ROI, etc.
  • Giving consideration to the company’s strength and position within the market and evaluate the potential merits of rebranding and relaunching
  • Reviewed key contracts and agreements (customers, suppliers, employees, lease, distribution, etc.)
  • Analysing ALL of the above in order to make a well-informed determination of the investment worthiness and suitability of the target company and of its market value

Going about these analyses in a vacuum unfortunately has several drawbacks, and most important of which is not having an independent, experienced and fresh perspective from someone who can help you guide the decision making. Engaging the services of an objective business consultant who would work with your team to impart their years of experience having navigated their clients through similar situations, can ultimately save your organization considerable effort, time and money both in the short-term, and in the long-term when by that time it’s too late.

As advisors we help you not only evaluate these transactions, but we also ensure that these transactions are in line with your expectations and objectives on profitability, diversification, growth targets, corporate culture fit, and core value alignment.

Once the parties have reached agreement through a Letter of Intent (LOI) or other document, the next step is to trigger a due diligence process to validate carefully the above in a more detailed manner.

Integration and Consolidation

Following the execution of the transaction, we also assist certain companies to ensure the desired integration and consolidation objectives are achieved. This is also a crucial part of the process as it is sometimes felt that all will fall into place after the deal is closed but that is rarely the case. The importance of integration/consolidation is commonly overlooked in these transactions however this post-acquisition step is a critical and determining factor in the success or failure of such a deal. To ensure a smooth transition, a detailed plan needs to be outlined, understood and implemented with careful consideration given to corporate cultures, effective communication and cooperation between the entities. Needless to say, even the most experienced will tell you that these plans are moving targets and will need to be constantly adjusted moving forward.

A consultant can prove to be very valuable to help you, whether you are the seller or the buyer in navigating through this analysis and transformation while others within your organization remain primarily focused on their existing functions and tasks.

For more information and details on how Aztec can help, contact us!

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