30 Jun Why M&A Deals Fail – ACEC buy-side sell-side Recap
In June The Coxe Group’s Simon Goodhead provided a national webinar to ACEC titled: Why M&A Deals Fail – How Organizational Behavior and Leadership Cause Deductive Deals. With Architecture and Engineering M&A buy-side & sell-side prevalence, many are considering their first transaction, or having already completed a transaction in the past with marginal success, are now looking to move forwards with another.
The question then becomes, with such a big step and investment of time and money, can we avoid failure, or a mediocre transaction? How do we make sure success is achieved?
Many consider financials as the key driver – this is probably the first mistake. Financials are important, but without a strategy in place, an authentic reflection on who your firm is, or deep consideration of your people and values, the transaction will likely end up being deductive. What is adding to the difficulty is your people see the failed transactions in the industry (often without the true information backing up their perception of failure).
We have achieved tremendous success guiding buy-side and sell-side transactions. The question then becomes this: why do we achieve so many successful M&A transactions for architecture and engineering practices? The answer is, as expected: it’s complicated. Here are a few things that we look for to achieve success, avoid red flags, and guide our clients:
- M&A Strategy development – external and internal alignment with market considerations
- Personal and values alignment – focus on values (and culture for colocations)
- Suiters meet the majority of priorities and point of the transaction
- Target size is a reasonable percentage of total volume
- Mindful of what sellers will gain (look for fairness)
- Mutual benefits for both parties
- Integration considers
- Financial
- Technology
- HR
- top line synergy
- Variation in success/failure
- What drives the variation
- Define success
Contact us to find out how we can help you in the development of your M&A strategy, and what can be done to aid your success.