Anchoring your merger or acquisition on a clear investment thesis

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Opinion | Anchoring your merger or acquisition on a clear investment thesis

In turbulent times, when we bear witness to trade wars and protectionism the world over, we’ve also seen a spike in mergers and acquisitions , as companies look to either bulk up or slim down to survive oncoming storms.

As companies ride out the storm, they need to position themselves to emerge from the downturn both strong and flexible. The right acquisitions can help. One key to avoiding disastrous, ill-considered or even emotional acquisitions is to have a clear-yet-flexible investment thesis; one that clearly articulates why buying a particular business will make your company more valuable.

In terms of the “best time” to carry out a transaction, there’s no time that is necessarily “better” than another. Often, when a publicly traded company has a high current share price, it will try to complete deals in which payment is made based on the highly valued share.

 

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