Redefining Business Success With IT M&A Advisory Services
Every company seeks to expand its hold and gain a significant position in the competitive market.
This may drive firms to either plan internal growth strategies or acquire assets, firms or technologies to the benefit of their growth as external growth initiatives.
Working out a strategy or planning an internal growth initiative may take a considerable amount of time to generate the desired growth results.
However, a corporate merger, takeover or acquisition can prove very beneficial for faster results and can generate increased revenue and brand recognition in a shorter time.
What actually is a Merger or Acquisition?
A Merger or Acquisition is the coming together of two firms or gaining assets for benefit of financial gain, brand enhancement and sustained market presence.
This trend is not limited to large enterprises and used as a competitive strategy. The value generated from the acquisition is called synergy (financial gain).
Though M&A may sound simple, it can entail a long process involving huge costs, government regulations, legalities, paperwork and more.
Why do companies engage in Merger & Acquisition(M&A)?
Here we will understand in detail why companies consider M&A:
- Growth: Many companies look at M&A as an opportunity for growth in terms of size and competition, which could be difficult to achieve through regular growth strategies.
- Face Competition: Competition serves as a survival factor for most companies. Because of this reason, some of them take the extra leap of acquisition to stay ahead of rivals in acquiring a brand with a value-adding portfolio of assets. The acquisitions of dot-coms and telecoms in the 1990s is the biggest proof of this trend.
- Build Synergies and Economies of Scale: Merged companies also aim to take advantage of synergy and economies of scale. Synergy takes place when two companies of similar profile combine or get rid of double resources such as branches and regional offices, among others. This drives every single penny earned to the lowest layers of the business chain, boosting revenue and making the M&A value-adding process
- Establish dominion: Organizations invest in M&A to establish dominion or superiority in a particular industry. However, this could create a situation of monopoly and result in constant monitoring and scrutiny from anti-competition watch guards.
- Dodge Tax:Considering the US’ corporate tax advantage over other countries, most US firms resort to a corporate inversion buying a smaller foreign competitor and move the entity to a lower-tax jurisdiction.
How M&A Firms Run the Deal-Making Process?
As discussed earlier, the Mergers and Acquisitions process can be quiet exhaustive. However, this process involves a set of intermediaries consulting firms who help ease the process including:
- Audit & Accounting Firms
- Consulting & Advisory Firms
- Investment Banks
- Law Firms
Consulting & Advisory firms include IT-based advisories, which guide clients through all the stages of the M&A process. These companies usually have a global presence and can assist the merged companies to walk through M&A, no matter where their geographical location is.
The IT advisory firms create Mergers and Acquisition blueprint, following smooth infrastructure remapping that will remove any hiccups from the merger. Veritis Group Inc. has served a varied range of companies with its world-class IT solutions and over the years, gained insight into the best practices of the IT industry.
Our M&A advisory services help organizations steer through the daunting process with a carefully-designed IT M&A plan and 360-degree customer support.
Here’s how Veritis can help?
- Improve your prospects of success by clearly defining your M&A strategy and objectives, M&A team and capability, and creating a repeatable process.
- Breeze through the M&A process with a clearly-defined assessment that removes any fears towards deal-making, identify synergies before your competition and plans for the integration well in advance.
- Draw maximum synergy from the deal with a test plan that identifies and eliminates any risks that can deprive the deal of its anticipated synergies.
- Planning to do away with a subsidiary or asset without having to undergo major risks? Veritis experts will help you create a plan keeping in mind all the risks and preparing the asset for sale, leaving your business to normally perform even in the absence of the asset or subsidiary.