Get the Expert Merger and Consulting Advice to Get More Synergy Value Mergers and Acquisitions (M&A) is a broad term used for the consolidation of companies or assets, involving multiple financial transactions. In addition to mergers and acquisitions transactions, M&A may include transactions related to tender offers, consolidations and management acquisitions. Merger is the combination of two companies while Acquisition is when one company is taken over by the other. M&A is done with a goal keeping in mind that generally two competing companies can perform better after merger and acquisition, rather than competing against each other. The Department of Financial Institutions deals with mergers and acquisitions in the USA. Synergy value Synergy value is always created with M&A, which can be seen in the higher revenues or lowering of the overall cost of capital for the merged companies. That way, a merger and acquisition consulting firm can help by providing you synergy value of 2+2 = 5, not the usual 2+2 = 4. Other chief reasons for mergers and acquisitions include the below ones:
Diversification of higher growth products and risks Financial surgery for the lower cost of capital Strategic realignment and technology change Economies of scale
Differences between mergers and acquisitions Here are some of the key differences between mergers and acquisitions that are worth taking into account:
In merger, two companies are dissolved to create a new entity, while in acquisition; the two companies do not lose their individual identity. Merger is done by the two companies of similar size while in acquisition; the larger company takes over the control of smaller company doing similar type of business. Merger requires minimum three companies while acquisition requires minimum 2 companies. There are relatively more legal formalities to complete as compared to the acquisition. Merger is done voluntarily by the two companies while acquisition may or may not be entirely voluntary. Merger and acquisition consulting often follows the below six standard stages of M&A process for successful outcomes. Stage 1: Review before acquisition This includes ascertaining the valuation and self-assessment of the acquiring company with regards to the proposed M&A. Stage 2: Screening the targets The M&A consultants will find out a good strategic fit for the most appropriate takeover candidate. Phase 3: Valuation of the target After the companies are shortlisted through primary screening, a detailed analysis is done, which is known as “Due Diligence”. Phase 4: Acquiring the target Thereafter, the merger and acquisitions consultants begin negotiations to come to the consensus. This will allow the merged companies to work for long, based on the agreed terms. Phase 5: Post merger acquisition
If all the above phases are successfully achieved, a formal announcement of merger and acquisition is done by both the companies. Merger and acquisition consulting firm Group50 has all the right talent and expertise to provide you the best M&A solutions for your business. They have been highly effective in getting remarkable merger and acquisition solutions for SMBs with focus on cost effectiveness. They boast of high success rate for their M&A efforts and specialize in providing solutions to small and medium size business that often lack access to experts’ advice due to high costs of consulting involved. Additionally, the company also provides solutions for corporate restricting and blockchain for supply chain. If you need best-in-class solutions for merger and acquisition, contact www.group50.com.