Volume 12, Number 2, December 2017
| M&A Proposal Geared to Success: Matters, Aspects and Theories to be considered by Acquirer |
Abstract
Although numerous studies analyze mergers and acquisitions (M&As) and there appears to be a plethora of experience and guidance to inform those tasked with preparing bids for and implementing M&A deals, yet the consensus of opinion appears to be that most mergers fail. This paper endeavors to address this paradox by evaluating critically the matters, aspects, theories, and facts that impact upon an M&A proposal. The paper attempts to answer the question why the failures occur and reviews the vast academic literature on M&A drivers, valuation methods, synergy estimates, operational and cultural compatibility of organizations to design a set of guidelines to steer those interested in undertaking a M&A in the right direction. The review deals with common pitfalls along the M&A journey, such as wrong timing within a wave and managerial overoptimism, with a focus on crucial role of employees and customers who often get neglected in M&A process. Derived from the examination of nature and characteristics of the matters, aspects, theories, and facts the paper develops a proposition how to arrive at a deal that would create value for the acquirer.
Keywords: Mergers, Acquisitions, Mergers and Acquisitions, M&A, Synergies, M&A Waves, M&A Valuation
JEL Classification: G34, G40