What are the driving forces behind the owners' growth ambitions? Regardless of whether one has ambitions to grow faster than the market, or simply to supplement and strengthen the present business, acquisitions can be a natural way of creating and/or accelerating growth. What conditions therefore, would one need in order to pursue an acquisition-based growth strategy?
When acquisitions end up on the board’s agenda, ground rules for an acquisition effort must be formulated in a growth strategy – where everyone involved in the process needs to know what will happen before, during and after the acquisition. A systematic approach is fundamental, but the strategy should also allow for and enable rapid action as and when random opportunities arise.
In addition to a clearly-defined growth ambition, what do the motives for the acquisition look like? What does the owner’s directive look like? Based on our vision and strategy:
The clearer the answers to the above questions are, the easier it is to map and identify potential acquisition targets and, not least, to run a resource-efficient and accurate acquisition process.
If the owners have growth plans, acquisitions can well be a part of such growth. Thus, if acquisitions are on the Board’s agenda, it’s important to ensure that this work is efficient with a genuine focus on quality. Over the years, Censor has developed a structured process of quality-assuring the acquisition process – from strategic planning through to the target company being integrated into a new ownership structure. The four steps of the acquisition process are:
1. Strategic planning
2. Practical preparations
3. The transaction phase
4. The integration phase
Proper resources and relevant skills are prerequisites for successful acquisition work. However, it is often difficult for a management team to manage its operational work in parallel with one or more time-consuming acquisition processes. Appointing an advisor that strengthens and complements existing teams creates added-value for both the process and the result as a whole when one wishes to buy a company.
It is following an acquisition, that the really big challenge often arises – to carefully integrate or merge the acquired business into a new structure. Significant values are at stake, not just the purchase price, but all of the opportunities you wish to develop and exploit in the newly acquired business. Cultural, structural and management issues should be focused with the ambition to prioritize the right efforts during integration or merger-related work. To this end, we have developed a model for integration and merger work in order to facilitate the efforts that should be given ample room for after an acquisition.