M&A with impact
Republished September 2019 (originally 2017)
M&A can significantly accelerate top-line growth, but the failure rate is extremely high. Extensive studies and research show failure rates for M&A deals ranging from 50%1 and up to as high as 90%2.
In our M&A research, only 62% of respondents from across the Nordic M&A community (including business development, line management and private equity) rated their own deals as successful. However, studies also show that companies that are actively engaged in M&A, i.e. frequent acquirers, usually outperform inactive M&A companies in terms of total shareholder return3.
This begs the question: What is the key to successful M&A?
Our guide is meant as a practical reference handbook on how to increase the likelihood of M&A success for business executives who may not have significant M&A experience. In this introduction, we share tried and tested tools, methods and insights that have proven to increase the likelihood of M&A success over time. It is not our ambition to provide an exhaustive guide on how to manage all M&A situations, but the focus is on the following three themes:
Chapter 1: Successful M&A strategies – outlining five M&A strategy considerations that have proven to increase the likelihood of M&A success across industries over time.
Chapter 2: Due diligence success factors – focused on practical tips and tools, including due diligence for commercial, operational, supply chain, IT, leadership and teams.
Chapter 3: Success factors for post-deal impact – outlining key considerations for impact post-deal, the synergies that have the highest success rates and the key to realising these synergies.
Our findings are based on our experience from working on a large number of pre-deal and post-deal situations, our pan-Nordic M&A survey from 2016 and recent events about M&A in Stockholm where +40 senior M&A professionals shared their insights, tools and experiences with improving the odds of M&A success.
1 Sher, Robert (19 March 2012). Why Half of All M&A Deals Fail, and What You Can Do About It. Forbes
2 Christensen, Clayton M., Alton, Richard, Rising, Curtis & Waldeck, Andrew (March 2011). The Big Idea: The New M&A Playbook. Harvard Business Review
3 Harding, David & Rovit, Sam (2004). Mastering the Merger: Four Critical Decisions That Make or Break the Deal. Harvard Business Press
Successful M&A Strategies
Article in Danish: A study of parameters for high-performing organisations.
Implement Consulting Group