Mergers and acquisitions (M&A) is a long and tedious process filled with challenges and surprises that could harm the acquiring company or destroy the deal altogether. To ensure a successful transaction, it's crucial to identify and overcome these hurdles. In this article, we'll discuss the most common M&A challenges and the best approach to overcome them, featuring Ritika Butani, Head of Corporate Development at Toast.
"You need to be empathetic, tactical, and direct when addressing issues with the target company, and adopt a collaborative approach rather than just laying down all the issues." - Ritika Butani
The most common M&A hurdles usually come from CEOs and founders who think they can do everything. Managing everything without any experts involved will result in errors. Here are some of them:
Ritika has 3 principles when it comes to M&A, and all must be true before pursuing a deal.
Every deal will have challenges. According to Ritika, the key is to stay calm and move forward. Avoid being too emotional when dealing with problems. Stick to the non-negotiables and the deal thesis of the company.
Also, be empathetic when communicating issues with the seller. The business is their life’s work, and listing down everything wrong with their business might startle them. Break down the news tactically and directly, while offering them help and solutions. Having a collaborative approach to solving issues will help both companies.