Given the importance of mergers and acquisitions to your company, it is recommended to choose a merger and acquisition specialist with great care. There are four steps to doing this properly. The payoff to finding the right person is substantial, as the right resource can help you over many years and create numerous opportunities. Conversely, the wrong merger and acquisition specialist can lead to major problems and march you into doing the wrong merger and acquisition transactions.
The first step is ensuring that the merger and acquisition specialist has a relationship based business model as opposed to a transactionally based one. This means that the person has a history of working with his clients over the long term, on many transactions. Though it may seem obvious, merger and acquisition specialists that value a relationship will prioritize the needs of the client ahead of their own need to close a deal and collect a fee. Quality merger and acquisition specialists believe that by helping clients become successful, they become successful and will then financially prosper from the relationship.
This type of thinking leads to an alignment between the company and the merger and acquisition specialist. The second step is ensuring the merger and acquisition specialist is indeed a specialist. Many advisors tout big resumes but few have the requisite skill sets that can really make a difference. Many merger and acquisition specialists are business brokers who focus on selling businesses. While they may have experience selling a company, it does not mean they have the ability to handle the demands of being a true merger and acquisition specialist. Most true M&A engagements include identifying a target acquisition, negotiating the deal, leading the due diligence and finding the financing. Only experienced people can deliver this range of requirements in an effective way.
Thirdly, the person must have a holistic, 360° understanding of your business and your long-term plan. This will enable them to target the right businesses for acquisition.
Finally, the most important aspect to choosing a merger and acquisition specialist is finding someone you can trust. Trust is the bedrock of all relationships and this is ever so true with a merger and acquisitions specialist. Using the wrong one can lead to bad deals and major financial problems. Using the right one can create a positive cycle of great opportunity.