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M&A Framework for Success - short


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M&A Framwork for Success by VSC Growth

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M&A Framework for Success - short

  1. 1. Mergers & Acquisitions: Part 2 Practical Framework for Success - Highlights<br />Steve Coote<br />Director, VSC Growth<br />Feb 2011<br /><br />Copyright © 2011. All Rights Reserved. VSC Growth<br />
  2. 2. The Market<br />Globally<br /><ul><li>M&A transactions > US $2 trillion p.a. ($2,000,000,000,000)
  3. 3. Transactions increasing post GFC
  4. 4. Emerging markets now represent 30% of global volume</li></ul>Australia<br /><ul><li>M&A transactions > US $130 billion p.a. ($130,000,000,000)
  5. 5. Current annual growth >10%</li></ul>Source - Thomson Reuters Oct 2010<br />
  6. 6. The Market - Why M&A?<br />“To grow or protect shareholder value and returns”<br />Source Towers Watson<br />
  7. 7. The Research <br />The results of the research are presented in our: <br />Mergers & Acquisitions Part 1 – 2011 Research Project<br />The research has been combined with our direct experience to provide practical guidance to those involved in M&A<br />Contact Steve Coote on +61 412 148428 or<br /><br />
  8. 8. Framework for success - Introduction<br />The Framework for Success addresses the questions arising from the research:<br /><ul><li>If the evidence shows such a consistently average track record, and there is so much guidance on how to do it well, then why doesn’t it change?
  9. 9. If we want to improve our approach, what are the fundamental things we need to?
  10. 10. What support is available?</li></li></ul><li>Framework for success<br />Surprisingly the research didn’t answer the question as to why, after 30 years, little has changed … but perhaps??<br /><ul><li>Incentives to grow companies outweigh the consequences of M&A failure
  11. 11. Companies continue to underestimate the resources necessary for integration and the realisation of synergies
  12. 12. Success relies on managing diverse and complex ranges of people and cultures… and this is not easy
  13. 13. If the original M&A goals are not met, there is a tendency for 2nd best to still be considered a success</li></li></ul><li>Framework for success - Summary<br />Step 1 – Commit to improve on the status quo<br />Step 2 – Understand your M&A model<br />Step 3 – Recognise the 3 key success factors<br />Step 4 – Create a robust strategy<br />Step 5 – Develop your processes & people<br />Step 6 – Execute each merger diligently<br />Step 7 – Enjoy your success<br />
  14. 14. 1/3 Destroy Value<br />1/3 Maintain Value<br />1/3 Create Value<br />Significant Value Created<br />Framework for Success Step 1 – Commit to improve on the status quo<br />Value Created<br />Negligible Value Created<br />“It is unrealistic to achieve perfection, but we should be seeking improvement”<br />Value Maintained<br />Improve some of these<br />Maximise these<br />Negligible Value Destroyed<br />Eliminate these<br />Value Destroyed<br />Significant Value Destroyed<br />“What difference would this result make to your organisation?”<br />Copyright © 2011. All Rights Reserved. VSC Growth<br />
  15. 15. Framework for Success Step 2 – Understand your M&A model<br />How do you currently do M&A, what works what doesn’t? <br />What do others do?<br />The Deal<br />(Pre-Completion)<br />Implementation<br />(Post-Completion)<br />Copyright © 2011. All Rights Reserved. VSC Growth<br />
  16. 16. “This is our M&A framework; everyone knows what they have to do”<br />Framework for successStep 6 – Execute each merger diligently<br />
  17. 17. Framework for successStep 7 – Enjoy your success<br /><ul><li>Deliver the promise of increased shareholder value
  18. 18. Celebrate what you do well
  19. 19. Reduce your risks by learning from others mistakes
  20. 20. Benefit from on-call experience
  21. 21. Build the skills & confidence of your support team
  22. 22. Uncover latent opportunities on old deals
  23. 23. Focus your energies where you can create the most value
  24. 24. Be prepared when the next deal comes off
  25. 25. Enter the next deal with greater confidence in the outcome</li></li></ul><li>If you would like to create more value from your growth initiatives, VSC Growth is ready to help you:<br /><ul><li>Mitigate the risks of bad deals
  26. 26. Turn average deals into value creators
  27. 27. Extract value from already completed deals
  28. 28. Build your company’s success rate in M&A</li></ul>We will do this by:<br /><ul><li>Understanding your business
  29. 29. Personal service and considered advice
  30. 30. Experience and a practical approach
  31. 31. Focusing on creating enduring value</li></ul>Framework for success<br />Contact Steve Coote on +61 412 148428 or email your enquiry to steve.coote@<br /><br /><br />
  32. 32. Want a closer look at the Framework?<br />A more detailed outline of what works is addressed in our presentation: <br />Mergers & Acquisitions Part 2 - Practical Framework for Success<br />The Framework combines our direct experience with the research to provide practical guidance to those involved in M&A<br />Contact Steve Coote on +61 412 148428 or<br /><br />