Timeframe to measure success of a M&A deal

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  • #70659
    Gauri Gupta
    Participant

    What would be the right time (e.g. in weeks/months) to assess or evaluate the success of an M&A deal and post-merger integration after closing ?

    • This topic was modified 3 weeks, 3 days ago by Gauri Gupta.
    #70830
    Ryan Dawkins
    Participant

    We develop multi-year valuation models to project the earnings of the deal then continue to monitor that for the life of the product. If we see those earnings change, then we investigate the forces causing the changes and correct when possible. We do establish shorter term synergistic targets that may be achieved during the integration or immediately afterwards. Part of setting those targets is establishing the expected timeline for results.

    #71161
    Martin Tse
    Participant

    We usually have a 100 day review after ‘Post Close Integrations’ to see how far we have come, as well as measure by financial reviews and comparing to previous quarters.

    #71219
    Shunji Brown-Woods
    Participant

    This is a good question. I believe that the approach to measure success will change slightly post-covid and be contingent upon timing. Success will have to be measured in intervals and with a blend of qualitative measures linked to the quantitative ones.

    #71456

    Hi !

    The ‘right time’ to assess or evaluate the ‘success’ of a M&A deal would depend on the target time frame set by the acquirer to complete the integration and reap the synergies in full. Acquirer has to set this ‘right time frame’ which is more realistic considering the magnitude and complexity of the integration job on hand and also the external factors if any that may have a bearing.

    To make sure the integration is successful and the synergies are reaped in full (and thereby the M&A deal itself), every acquirer has to continue to assess the progress at the pre-determined intervals, take prompt action as deemed fit after such periodic assessments and finally ensure the whole process is completed on time and as desired without any dilution.

    Hope this helps.

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