It is not uncommon for a company acquisition to be viewed as a simple transaction that means transferring the business from one owner to another. But rather than just allowing the business to simply carry on as is under new leadership, a merger or acquisition should be viewed as a solid strategy to boost the company’s overall health, productivity, and bottom line. While M&A transactions can serve as great solutions for exit strategies, they can be so much more than that. M&A should be regarded as a powerful tactical opportunity.
Often times, M&A deals are considered to be a way to get out and cash out with instant gratification. But what else might be possible when a deal is carefully crafted to deliver sustainable returns and support a powerful legacy for the business in the long-term? M&A done right can translate into great success for a company and, ultimately, its leadership.
Examples of M&A that work as strategy enablers can include investment in growth in new sectors. A large company can diversify its portfolio of offerings through the acquisition of specialized firms. For example, just look at Google, who has acquired YouTube, Fitbit, Android, Nest Labs, and Waze. While these deals can happen on a massive scale, the strategy can still apply for lower and middle-market businesses. Other strategic motivations for M&A include consolidation to enhance market share, improve a product’s time to market, reduce price competition, acquire intellectual property, or exploit economies of scale, just to name a few.
More and more acquisitions are being arranged with the goal of acquiring talent. Sectors of all types are experiencing talent shortages. The COVID-19 pandemic has somewhat slowed this type of deal activity as some companies are downsizing, but many companies are still moving toward digital transformation, which gives them a major need for talent.
Effective M&A strategies are proven to take businesses to the next level, but you don’t want to go it alone. It’s a complicated process with many opportunities to not only grow, but also to make mistakes. Expertise can make a world of difference in how much you benefit from a deal. At Benchmark International, we are motivated to help business owners make game-changing deals, and our experts would love to hear from you to discuss how we can work with you to make great things happen for you and your future.
Americas: Sam Smoot at +1 (813) 898 2350 / Smoot@BenchmarkIntl.com
Europe: Michael Lawrie at +44 (0) 161 359 4400 / Enquiries@BenchmarkIntl.com
Africa: Anthony McCardle at +27 21 300 2055 / McCardle@BenchmarkIntl.com
ABOUT BENCHMARK INTERNATIONAL
Benchmark International’s global offices provide business owners in the middle market and lower middle market with creative, value-maximizing solutions for growing and exiting their businesses. To date, Benchmark International has handled engagements in excess of $6B across various industries worldwide. With decades of global M&A experience, Benchmark International’s deal teams, working from offices across the world, have assisted hundreds of owners with achieving their personal objectives and ensuring the continued growth of their businesses.