As someone who has experienced first hand a “failed” acquisition, there seems to be a gap in commercial DD where we really look at the target company’s value proposition. While there is no template for this, I think there is significant value in mapping the value proposition of the target company’s product portfolio in key markets, analysing how sustainable it is given industry changes and crucially, what it would look like after the integration into the buying company. What are your thoughts on this?
I would be interested to learn more about your firsthand experience with a “failed” acquisition. Was it related to a gap in commercial DD (i.e. the gap you described in your post)? That said, I agree that there is value in mapping this out, although I think that this is already a core part of commercial DD (or at least thorough commercial DD would give you the inputs to map out the target company’s value prop).
Agree with you, but I’d also add that it might be worthwhile to consider not just how the value proposition of the target maps on the its products and services, etc. but also consider the business/commercial strategy of the target, i.e., What is the plan for realising the value proposition and how is that going to happen?
There is certainly value, perhaps even necessity, in clearly, diligently mapping value proposition during commercial due diligence. Having said that, there needs to be assurance or measure in place to ensure these mappings are genuinely referred to and used effectively during and even post integration least it becomes another paper exercise which happen in a number of mergers and acquisitions across industries and borders.