This document provides an overview of the acquisition process, beginning with identifying the strategic drivers and intent behind an acquisition. It discusses evaluating acquisition targets based on tangible and intangible assets, as well as integrating acquired companies by appointing change agents, communicating structuring, and setting performance expectations. Finally, it notes that mastery in acquisitions comes from institutionalizing changes to achieve synergistic success over the long run.

1. Acquisitions 101Intent/DriversArchitectureStrategy MapIdentificationEvaluationMechanicsK V RameshInstitutionalizationSynergyIntegration© 2010 K V Ramesh

2. Intent/DriversConsolidationBuying the CompetitionDiversificationIncreasing the Value Chain WidthParkingBenefit from Arbitrage in Unrelated AreasRe-PositioningSynchronizing with Societal ChangesParadigm PioneeringBetting on Future Technologies

3. ArchitectureGrowth through Tangible Assets (Resources) Vs. Intangible Assets (Capabilities)Profit Margin as a measure of Process EfficiencyAsset Turnover as a measure of CapabilitiesLeverage as a measure of CreativityCapabilities – Human CapitalBaseline EstablishmentTracking Growth against ValuationManaging => Retention & Sustenance

4. Strategy MapWhatValue Generation & Delivery InfrastructureWhyMaslow’s Hierarchy of Needs – Recognition NeedsWhereLeadership in Demanding MarketsWhenTowards Portfolio BalanceHowWith Value Fit, Integration, and Institutionalization

5. IdentificationRelevance to the StrategySize – Turnover, Territories, TechnologiesInfrastructure/Platform or ApplicationsStage in the Business CycleWith Sustainable Competitive Advantage or For Building Competitive AdvantageGeo Political, Civility, and Ethical ConsiderationsRegulatory, Ecological, and Infrastructural FrameworksEase of Exit, Related Costs and Value Loss

6. EvaluationTangiblesCustomer Capital, Brand, Financials, and LiabilitiesIntangiblesProcess, Practice, People, and ProductsEthics, Excellence, and Eco-ConsciousnessCulture, Communication, and CommitmentTQM (6σ, BPR, CMM, ISO), and ERP/MIS SystemsIPR, Time-to-Market, and Re-positioning

7. MechanicsLegal & Environment ClearancesEconomicsEBITDA/WACC Vs. Market Cap, Book Value etc StructureCash, Stock, Swap etcNegotiation & Execution

8. IntegrationChange Agent & BriefStructured CommunicationHandling the Management TeamBitter Medicine – Only Once – Short WindowPerformance Expectations & MeasurementsTime table with Milestones for Tracking Integration

9. Synergistic SuccessMarket Acceptance of Value DeliveryJoint Positioning of Brands, Practices, and ProductsCompensation & Benefits ParityManagement Team Rotation in the GroupUnified CultureAdaptability to Marketplace Changes

10. Mastery lies in InstitutionalizationI can be reached at the.kvr@gmail.com