The Four Rules of Acquisitions

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    Anandan Rajagopalan

    In order for M&A activities to be successful at strategy level, the 4 rules of acquisitions recommended by Andrew Campbell, Director Ashridge Strategic Management Centre are as follows:
    1. Incremental value needs to be substantial to justify premium
    2. The incremental value you can create needs to be greater than the incremental value other bidders can create
    3. The incremental value needs to be greater for businesses that are unfamiliar
    4. ‘Net’ value created by the acquisition needs to be greater than the value that can be created by using the same resources in an alliance or JV or other project Value

    I am sure there may be other rules of acquisition at strategy level like structure, leadership, and culture. Please share your thoughts. Thanks

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