GDP Blog

Planning a merger or acquisition? 10 questions could save your company

Posted by John Powter

Jul 21, 2014 9:43:00 AM


M&A activity is up, way up this weekend the recent pharmaceutical AbbVie tie up pushed the deals to over the $2 trillion mark which hasn't happened seen since 2007, and it is only July.

Our short questionnaire will address and help you identify "deal killers" if you are interested in the full process contact our office at 800-473-8697 to setup an appointment.

Here is what our process will help you with mergers-acquisitions-300x199-321952-edited

  • Leadership and Company Values
  • Strategy
  • Operations
  • Clients

If your company is considering an acquisition these 10 questions can help you decide if it's going to be years of bliss or a bad marriage. I use the marriage example because we have all seen good and bad marriages; an acquisition is just the same. We have seen companies try to integrate difference cultures and after a failed attempt both companies went out of business. We feel this is an emerging risk that isn’t being addressed.

Forbes rates the success for Mid-Market companies performing a successful integration at 50%, eerily close to the marriage success rate. It is not the P&L that is the main cause it is the integration and continuation piece which has to do with companies culture and value beliefs.

We now rank culture on an equal level as financial performance in our matrix that we review potential opportunities. This caused us to wonder how do you measure culture? When my wife and I first got married we had to attend a couple camp put on by the church. They asked us questions about our belief systems, how many children each of us wants to have, how do you handle bills? Thankfully we had addressed most of these, what fascinated me was over half of the couples had not and that process brought to life some potential “deal killers.” How many years of pain and suffering did that potentially save from a couple realizing these issues after the fact. So we created our own mergers and acquisitions culture assessment to help avoid the same issues for companies considering getting married.

Remember to address the issues before walking down the aisle with another company. It may seem like the perfect fit, but you do not want be remembered like the list below. Contact your GDP advisor for help or our full questionnaire.

Time Warner & AOL Deal $99 Billion Loss

Quaker & Snapple $1.4 Billion Loss

Topics: Risk Management

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