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The marriage of two companies 

by on May 26, 2016

Walking Down the Aisle

Marriage is often used to describe the union of two companies, everything from dating to consummation. I recently gave my daughter away at her wedding, which in large part explains the big gap between my last post and this, and it made me think about the union of two companies.

How do you know if it’s the right deal?  How do you know if it’s the right company?

I like my new son-in-law. I do. I’m lucky that way. What would happen if I didn’t? Fortunately I don’t have to find out.

In the business world, like in a marriage, it can be hard to say why two companies are good together or why they’re not. But there are things to look for in any union as indicators of future outcomes.

Is the cultural fit good?  Do they share the same interests? Do they compliment each other?  Are they different enough to be stronger together than they would be separately? Do they have similar goals and dreams?

Putting on a wedding is an all-consuming event just like negotiating the terms of an acquisition or running the due diligence process, whether you’re the buyer or the seller. It was really challenging to run my business and plan for the wedding.  Once the wedding activities began, a week before the actual wedding, it was almost impossible to focus on work.  The same occurs in the M&A process.  The details and the scope of the undertaking require your focus and attention, sometimes to the detriment of the day-to-day process and the engine that is making it all possible.

I can tell you I was very glad we had a Wedding Coordinator.  She was someone who we could turn to to deal with specific issues that arose at the last minute.  One of the biggest issues we had at the wedding was a shuttle bus that got itself stuck in the driveway.  Once the wedding coordinator was informed of the problem she immediately went about resolving it.  Crisis averted while we could focus on our guests and the celebration.

We still had to make decisions, her involvement didn’t release us from that, but she had experience and a knowledge of what has worked in the past and what didn’t so that we could get it right in our wedding.

Not everything went right but it was a fantastic event.  Everyone said so.  While there was a lot of stress leading up to and during the event none of the guests noticed.  So I guess we pulled it off.  It’s like that “Be Like a Duck” quote attributed to Michael Caine: Calm on the surface, but always paddling like the dickens underneath.

That’s how you should approach the M&A process, whether buying or selling.  Be prepared, utilize an expert or adviser to help with the details, the last minute crisis, and avoid the mistakes others have made.

p.s.

If you’re wondering how you build a company that you can sell for a premium in a few years, contact me to discuss the Valuation Amplification Process.

I also invite you to download the white paper and learn the 5 step process on How to Quickly Increase Your Valuation: a Proven 5 Step Process.

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From → M&A

One Comment
  1. Laurie Bos permalink

    Like the photo to start off a interesting topic

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