Things To Keep In Mind When Considering A Merger

Global Capital Partners > Uncategorized > Things To Keep In Mind When Considering A Merger

If you considering undertaking a merger, you may be too focused on the projected financial statements and consolidated financial statements. If the projections look good, you may think that the merger would immensely benefit your company.

However, mergers aren’t a walk in the park.

In fact, some mergers can even prove to be toxic which can hurt both companies in the long run.

A successful merger needs to be planned and executed very carefully, only then do companies gain the strategic advantage they were looking for.

Here are some important considerations to keep in mind:

Purpose

A merger is a major step for any organization, which is why it is important for both parties to be clear about the purpose.

The purpose could be economies of scale, data sharing, operation integration or infrastructure sharing. Everything should be clearly put on the table and how both the parties are looking to benefit from the situation.

Communications

Whenever a merger is the in the pipelines, there is a lot of uncertainty among employees. No one likes to remain in the dark about what’s going on. They expect to know what the company is planning for the future.

Share the future goals, merger objectives, milestones and most importantly the workforce plan with employees. Panic in the workforce is the last thing you’d want, as it can cause disruption in the overall merging process.

Company Culture

You can’t expect other company cultures to be like yours. But whatever company you’re merging with should at least have a culture that will blend well.

The cultures of the both the companies should align with the employees well, as productive relationships and team building is important for any company to succeed.

Exit Strategy

Mergers don’t always work out. If things do not go as planned, it is the small companies that usually suffer and often wind up.

This is why it is important to have an exit strategy in mind. If the merger doesn’t work, how will the merger be un-winded?
Some companies even run parallel operations for a certain period of time, to see of the engagement is working, before actually doing the actual merger.

Looking for funding?

If you are looking to fund your next merger, get in touch with us by dialing 1-800-514-7350 or visit our website. We are one of the leading private money lenders in NY, and provide flexible financing solutions to businesses.

Leave a Reply