A successful deal is a win-win for both parties and can be measured in a variety ways. Each deal is unique but there are certain traits that every successful partnership should possess.
Prepare thoroughly
It is crucial to thoroughly prepare for negotiations prior to sitting down at the table. This includes researching the nuances of the market and identifying possible synergies. It is also crucial to understand your counterparties’ objectives, priorities and motivations. Being aware of the other side’s perspective will help you gain leverage and help ensure that your deal is successful.
Be prepared for the unexpected
Deal making is a volatile process, and unexpected alterations can frequently sabotage plans. This could be due to the unexpected discovery of a regulatory issue an unexpected lawsuit, or some other event, it is essential for all parties to be prepared for the unexpected. This may include having a backup plan in place and an exit strategy should the plan is not successful.
Identify key people
Buyers should concentrate on keeping the most important team members of a company they are considering buying after the sale. It is common for acquirers to not retain talent, which can derail post-acquisition growth and erode value. It is essential to know the culture and values to ensure that it will fit with the acquired company’s. This will ensure that the acquired company will continue to grow its revenue after the acquisition. It is not unusual for a buyer to see a drop in revenue following a transaction. This is due to the fact that the team acquired is focused primarily on delivering the revenue goals and synergies set before the acquisition.