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Developing Business and Acquisition Plans--Phases 1 2 of the Acquisition Process

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Developing Business and Acquisition Plans--Phases 1 2 of the Acquisition Process

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    1. Developing Business and Acquisition Plans--Phases 1 & 2 of the Acquisition Process

    3. Current Learning Objectives Primary learning objectives: To provide students with an understanding of a highly practical “planning based” approach to managing the acquisition process and the issues associated with each phase of the M&A process Secondary learning objectives: To provide students with an understanding of selecting the correct strategy from a range of reasonable alternatives and how to develop an acquisition plan

    4. The Acquisition Process Pre-Purchase Decision Activities Post-Purchase Decision Activities Phase 1: Business Plan Phase 2: Acquisition Plan Phase 3: Search Phase 4: Screen Phase 5: First Contact Phase 6: Negotiation Phase 7: Integration Plan Phase 8: Closing Phase 9: Integration Phase 10: Evaluation

    5. Phase 1: Business Plan Industry/market definition

    6. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers)

    7. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers) Internal analysis (strengths and weaknesses as compared to the competition)

    8. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers) Internal analysis (strengths and weaknesses as compared to the competition) Opportunities/threats (from external and internal analyses)

    9. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers) Internal analysis (strengths and weaknesses as compared to the competition) Opportunities/threats (from external and internal analyses) Business vision/mission

    10. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers) Internal analysis (strengths and weaknesses as compared to the competition) Opportunities/threats (from external and internal analyses) Business vision/mission Strategies (cost, differentiation, focus, or some combination)

    11. Phase 1: Business Plan Industry/market definition External analysis (customers, current competitors, potential entrants, substitute products, and suppliers) Internal analysis (strengths and weaknesses as compared to the competition) Opportunities/threats (from external and internal analyses) Business vision/mission Strategies (cost, differentiation, focus, or some combination) Implementation strategy (selected from range of reasonable options) Solo ventures or “go it alone” Merger or acquisition Alliances (including JVs, partnerships, and licensing) Minority investments and Asset swaps

    12. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives)

    13. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable

    14. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review

    15. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences

    16. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences Search plan

    17. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences Search plan Negotiation strategy

    18. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences Search plan Negotiation strategy Determine initial offer price

    19. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences Search plan Negotiation strategy Determine initial offer price Financing plan

    20. Phase 2: Acquisition Plan Plan objectives (support the realization of key business plan objectives) Timetable Resource/capability review Management preferences Search plan Negotiation strategy Determine initial offer price Financing plan Integration plan (or “exit strategy” for financial buyers)

    21. Things to remember... The success of an acquisition is dependent on the focus, understanding, and discipline inherent in a thorough and thoughtful business plan An acquisition is only one of many options available for implementing a business plan Once a decision has been made that the implementation of the firm’s business strategy requires an acquisition, an acquisition plan is required.

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