Many mistakenly think of an acquisition strategy as the only strategy, leaving the business to ‘float’ while all hands are on deck to steer the company into the hands of another captain. But then what? Rather than be a substitute, M&A should be seen as an enabler putting the wind in the sails of a business.
In many cases, M&A is seen as a lucrative end game, with management receiving instant credit for deal completion. However, though never guaranteed, the chances of generating a long-term, sustainable return that delivers a legacy for all parties are greatly increased when M&A is leveraged as an enabler for the business to reach its potential.
M&As that act as strategy enablers might include those that look to invest in growth in new sectors, such as Blackberry continuing its diversification strategy through the acquisition of British security testing and training firm Encription Ltd. A further strategic motivation for M&A might be consolidation to improve market position or pricing, demonstrated recently by Zoopla’s merger of property portals.
Interestingly, an increasing number of acquisitions are undertaken in order to acquire a company’s human capital. This is perhaps unsurprising as talent shortages become increasingly prevalent across a range of industries. Google is a great example of a company that continuously undertakes investments to acquire human capital in order to inject the entrepreneurial spirit of a small company into its operation.
Other strategic motivations for M&A might include shoring up the supply chain, or acquiring IP assets to plug pipeline gaps – strategies which are particularly common motivators for M&A activity in the pharmaceuticals industry.
Whatever your strategic motivation, why not consider M&A to put the wind in the sails of your business. With representation throughout the Americas, Europe, Africa and Asia, Benchmark International can connect you with the right opportunity. To find out more, visit https://www.benchmarkcorporate.com/