Activity in M&A often comes in bursts. As of the second quarter of 2013, the scent is in the air. Company management is flush with cash, bolstered by buoyant share prices, and face slow prospects for organic growth.
But capturing value by creating a whole that is greater than the sum of its parts is risky. Recently, L.E.K. Consulting analyzed the performance of more than 2,500 M&As between 1993 and 2010 – a period that included two boom and bust economic cycles. L.E.K. found that nearly 60% of companies destroyed shareholder value after the deal closed.
In this new Executive Insights, L.E.K. shares how management can overcome common pitfalls to beat the long odds of creating value through mergers and acquisitions. From identifying the right target to synergy valuation to post-merger integration, winners have shown that with the right approach, value through M&A can be found and captured.
Marketing Analytics: A Smarter Way for Auto and Home Insurers to Gain Competi...Cognizant
For personal lines carriers, defensive marketing strategies are no longer enough to win and retain customers. Given the industry's questionable returns from past marketing efforts, insurance companies will have to invest wisely and work smarter to take advantage of today's advanced marketing analytics capabilities.
Clients Look Ahead at Agencies (RSW/US 2011 Survey)Kirill Smirnov
The 2011 New Business Report: A Client’s Look Ahead at Agencies was completed by 174 key Marketing decision makers from across the United States during March, 2011. The study takes a look at where Marketers think Agencies are headed in the coming years and analyzes Marketers’ overall satisfaction with Agencies and presents ideas/suggestions on how Agencies should pitch and market to prospective clients.
Why Your Car Will Soon Become Your FriendCognizant
The advent of voice assistants built on natural language processing, artificial intelligence and telematics will unleash an assortment of voice-activated features and functionality that will make driving more enjoyable, efficient and effective.
Marketing Analytics: A Smarter Way for Auto and Home Insurers to Gain Competi...Cognizant
For personal lines carriers, defensive marketing strategies are no longer enough to win and retain customers. Given the industry's questionable returns from past marketing efforts, insurance companies will have to invest wisely and work smarter to take advantage of today's advanced marketing analytics capabilities.
Clients Look Ahead at Agencies (RSW/US 2011 Survey)Kirill Smirnov
The 2011 New Business Report: A Client’s Look Ahead at Agencies was completed by 174 key Marketing decision makers from across the United States during March, 2011. The study takes a look at where Marketers think Agencies are headed in the coming years and analyzes Marketers’ overall satisfaction with Agencies and presents ideas/suggestions on how Agencies should pitch and market to prospective clients.
Why Your Car Will Soon Become Your FriendCognizant
The advent of voice assistants built on natural language processing, artificial intelligence and telematics will unleash an assortment of voice-activated features and functionality that will make driving more enjoyable, efficient and effective.
Competing to Win in the Media & Entertainment IndustryCognizant
To outperform in tough times, media and entertainment companies must rejuvenate their business, operating and technology models by jettisoning nonvalue- adding activities and reinforcing core strengths that provide sustainable growth, despite funding challenges.
This white paper is intended to stimulate thought and discussion for measuring the return on intranet and corporate portal investment.
It also documents different benchmarks and success stories of leading enterprises that successfully measure such value.
To download a PDF version of the report, please visit: http://www.prescientdigital.com/articles/finding-roi-white-paper?searchterm=finding+roi
Update: I have added two slides towards the end discussing the IPO
This is a presentation I made for my students. It covers different aspects of Groupon case, including marketing, finance, accounting, and corporate governance.
Successful organizations approach M&As and people integration in a very systematic and methodical manner. Companies use standardized, but adaptable integration playbooks that contain step by step detailed instructions with tools, templates, checklists, process documentation, and tips to cover each major phase of the M&A from beginning to end.
Competing to Win in the Media & Entertainment IndustryCognizant
To outperform in tough times, media and entertainment companies must rejuvenate their business, operating and technology models by jettisoning nonvalue- adding activities and reinforcing core strengths that provide sustainable growth, despite funding challenges.
This white paper is intended to stimulate thought and discussion for measuring the return on intranet and corporate portal investment.
It also documents different benchmarks and success stories of leading enterprises that successfully measure such value.
To download a PDF version of the report, please visit: http://www.prescientdigital.com/articles/finding-roi-white-paper?searchterm=finding+roi
Update: I have added two slides towards the end discussing the IPO
This is a presentation I made for my students. It covers different aspects of Groupon case, including marketing, finance, accounting, and corporate governance.
Successful organizations approach M&As and people integration in a very systematic and methodical manner. Companies use standardized, but adaptable integration playbooks that contain step by step detailed instructions with tools, templates, checklists, process documentation, and tips to cover each major phase of the M&A from beginning to end.
M&A success: Using an integration playbook to make your deal workGrant Thornton LLP
Only about 50% of mergers or acquisitions will succeed. And even when deals go through, the newly created company may not deliver the hoped-for financial results. Integration playbooks can make the difference.
Mercer Capital's Value Focus: FinTech Industry | Third Quarter 2021 Mercer Capital
Mercer Capital’s quarterly newsletter, FinTech Watch, provides an overview of the FinTech industry, including public market performance, valuation multiples for public FinTech companies, and articles of interest from around the web. This newsletter focuses on FinTech segments, including payment processors, technology, and solutions companies, examining general economic and industry trends as well as a summary of M&A and venture capital activity.
In this paper author Nicholas Assef covers the benefits of private companies adopting a private equity mindset to consider strategies that should be adopted and actions that should be taken in planning to sell their company.
In particular this encourages the Private Company directors & shareholders to step outside of their day to day operations and reflect on the way the Company will be seen by external parties. Once this assessment has been made then adjustments can be made with plenty of time in order to optimise the business case.
Driving a business to a successful exit is a matter of science and not good fortune.
Mergers and acquisitions (M&A) have long been an integral part of corporate strategy. With very few exceptions, almost every company, large and small, at some point in their strategic assessment has evaluated acquisitions as a means of growth, survival or an exit strategy.So why are companies making the investment of billions in evaluations, due diligence, legal and accounting fees and integration costs? The bottom line: They are doing it in the pursuit of Merger Math.
Mercer Capital's Value Focus: FinTech Industry | Second Quarter 2016 Mercer Capital
Mercer Capital’s quarterly newsletter, FinTech Watch, provides an overview of the FinTech industry, including public market performance, valuation multiples for public FinTech companies, and articles of interest from around the web. This newsletter focuses on FinTech segments, including payment processors, technology, and solutions companies, examining general economic and industry trends as well as a summary of M&A and venture capital activity.
Enhancement in NDT inspection for operational effectiveness, efficiency and e...Innerspec Technologies
We intend to show that any change shall be linked, not only to improvement, but also to immediate cost reduction so that all management structure can conceive quick implementation as
part of its department strategy & enhancement in their budget cost.
For that, concepts such as effectiveness, efficiency and excellence must be approached. We will give clear saving cost ways which will follow the terminology.
In Financial terms and without a deep analysis, we can conrm cost savings above 30% from current prices are achieved.
Insights Success has shortlisted "20 Most Admired Companies of the Year 2019 with an intent to acknowledge & admire the novel approaches of these businesses
Measure What Matters - New Perspectives on Portfolio SelectionUMT
Stock market investors articulate their goals explicitly or implicitly by following the philosophy and methodology of a market expert that fits their investment objectives and appetite for risk. For example, for value and income stocks they may rely on the research conducted by Wharton finance professor Jeremy Siegel¹ or read up on market pros like War-ren Buffet. Much like the stock market investor, companies investing in change face similar challenges when considering where to allocate budget and resources to meet financial and strategic objectives.
Tax reform actually changes everything. We've never had a moment in which so much cash will be sitting on corporate balance sheets. The most strategic-minded executives will see this opportunity as a watershed moment to reevaluate how they allocate cash.
Equity Research 16 December 2002AmericasUnited Stat.docxYASHU40
Equity Research
16 December 2002
Americas/United States
Strategy
Investment Strategy
Assessing the Magnitude and
Sustainability of Value Creation
Illustration by Sente Corporation.
• Sustainable value creation is of prime interest to investors who seek to
anticipate expectations revisions.
• This report develops a systematic way to explain the factors behind a
company’s economic moat.
• We cover industry analysis, firm-specific analysis, and firm interaction.
Investors should assume that CSFB is seeking or will seek investment banking or other business from the covered
companies.
For important disclosure information regarding the Firm's ratings system, valuation methods and potential conflicts of interest,
please visit the website at www.csfb.com/researchdisclosures or call +1 (877) 291-2683.
research team
Michael J. Mauboussin
212 325 3108
[email protected]
Kristen Bartholdson
212 325 2788
[email protected]
Measuring the Moat 16 December 2002
2
Executive Summary
• Sustainable value creation has two dimensions—how much economic profit a
company earns and how long it can earn excess returns. Both are of prime interest to
investors and corporate executives.
• Sustainable value creation is rare. Competitive forces—including innovation—drive
returns toward the cost of capital. Investors should be careful about how much they
pay for future value creation.
• Warren Buffett consistently emphasizes that he wants to buy businesses with
prospects for sustainable value creation. He suggests that buying a business is like
buying a castle surrounded by a moat—a moat that he wants to be deep and wide to
fend off all competition. According to Buffett, economic moats are almost never stable;
competitive forces assure that they’re either getting a little bit wider or a little bit
narrower every day. This report seeks to develop a systematic way to explain the
factors that determine a company’s moat.
• Companies and investors use competitive strategy analysis for two very different
purposes. Companies try to generate returns above the cost of capital, while investors
try to anticipate revisions in expectations for financial performance that enable them to
earn returns above their opportunity cost of capital. If a company’s share price already
captures its prospects for sustainable value creation, investors should expect to earn
a risk-adjusted market return.
• Studies suggest that industry factors dictate about 10-20% of the variation of a firm’s
economic profitability, and that firm-specific effects represent another 20-40%. So a
firm’s strategic positioning has a significant influence on the long-term level of its
economic profits.
• Industry analysis is the appropriate place to start an investigation into sustainable
value creation. We recommend getting a lay of the land—understanding the players, a
review of profit pools, and industry stability—followed ...
Strategic Success: Closing the Deal Isn't a StrategyTodd Antonelli
Executives involved in decision-making on key corporate acquisitions need to ask not “Are we doing things right?”
but instead “Are we doing the right things?”
L.E.K. Consulting’s annual Media & Entertainment Study
was conducted between December 2018 and January
2019. We surveyed around 2,000 households on their
entertainment choices, preferences and viewing habits.
This Executive Insights analyzes key findings about
movie theater attendance and subscription services.
The Fourth Annual Global Mobility Study [hyperlink] by L.E.K. Consulting, Vision Mobility and CuriosityCX highlights that there is a much greater uptake of ride-hailing and other new mobility options in India and China than in mature western economies. With relatively low levels of car ownership and less developed public transport systems in these Asian countries, new mobility use is now comparable with and set to overtake traditional transport for a segment of the population.
5 Opportunities in the Nutritional Supplements IndustryL.E.K. Consulting
According to the third installment of a biennial survey L.E.K. Consulting conducted on the healthy living marketplace, U.S. adult consumers spend, on average, a reported $635 on nutritional supplements each year: $433 on vitamins, minerals and herbal supplements (VMS), and $202 on sports nutrition products. And yet, within both categories, there is still room for further growth.
Indeed, when asked about their prior month’s purchases, just 55% of consumers who make H&W a priority said they bought VMS, and only 25% had purchased sports nutrition products. In other words, for retailers and brands there are some significant opportunities — and even a lurking threat — to be found.
Infrastructure Victoria - AZ/ZEV International ScanL.E.K. Consulting
InfrastructureVictoria for released the Evidence Base that will inform its advice to the Victorian Government on the infrastructure required to support automated and zero emissions vehicles. The Evidence Base includes the findings of ten projects to address key areas, including transport, energy, ICT and urban design. L.E.K. Consulting contributed to this work program, undertaking an international scan of the regulation and technical standards relating to automated and zero emission vehicle technologies.
The Rapidly Evolving Landscape of Meal Kits and E-commerce in Food & BeverageL.E.K. Consulting
Consumers are increasingly strapped for time, and when they’re shopping for and preparing fresh, healthy food, every extra minute counts. Here’s where meal kits and e-commerce come in: they give consumers control and the ability to personalize their meals, while saving them valuable time otherwise spent on shopping and food prep.
In this webinar, Rob Wilson, Managing Director at L.E.K. Consulting, and The Food Institute will explore the $150 billion land grab of e-commerce sales in food & beverage and the role of meal kits in this rapidly evolving landscape.
Top 8 Insights From the 2018 Beauty, Health & Wellness SurveyL.E.K. Consulting
Think nutritional supplements and skincare are of interest only to consumers of a certain age? Think again. According to L.E.K. Consulting’s third installment of a biennial survey of the healthy living marketplace, this one focusing on nutrition and skincare, some 80% of health and wellness (H&W) consumers across generations — from millennials to baby boomers — are highly engaged with both categories.
The survey captured insights from more than 1,600 respondents, representing roughly 77% of the U.S. adult population who identify with H&W themes, and generated eight key insights across categories. Together these insights make clear that consumer interest in nutritional supplements and skincare often lasts a lifetime.
L.E.K. Consulting recently surveyed more than 200 U.S. brand managers and packaging stakeholders at consumer packaged goods companies to understand their packaging needs and views on trends driving demand.
The survey focused on topics that include:
- Brand trends and their effect on packaging demand
- Shifts within packaging (e.g., new materials, packaging innovations)
- Perspectives on packaging demand (including forecast spend on packaging for their brands)
This Executive Insights analyzes key findings from this proprietary research
Spotlight on Media & Entertainment: Box Office TrendsL.E.K. Consulting
In the first installment of our Executive Insights “Spotlight on Media & Entertainment" series – which features our insights in a new impactful visual format – we focus on box office trends. L.E.K.’s Dan Schechter, Gil Moran and Francesco Di Ianni explore the current trends in admissions, movie production, movie ticket prices and whether the 3D movie growth may be coming to an end.
Capitalizing on Opportunities in Fresh Prepared FoodsL.E.K. Consulting
With the increased focus on investing in the perimeter of the grocery store, fresh prepared foods is one of the most interesting growth areas for U.S. grocers. The lines of retail and foodservice have been blurring as grocers realize there is a golden opportunity to capitalize on consumers’ desire for fresh prepared foods and drive foot traffic.
This Executive Insights profiles the high-growth category of fresh prepared foods and why retailers and suppliers alike can expect to find significant opportunities in this market for years to come.
The 2016 Health & Wellness Study examines consumer spending preferences for nutritional supplements, personal care and healthy grocery products among Millennials, Gen X and Boomers. The study looks at category engagement, drivers of channel selection and, the potential for subscription services, as well as the success factors for private-label products. Selected highlights:
While some H&W categories are more “mature” in terms of generational penetration there appears to be significant opportunity to bring Gen Xers and Boomers into more complex categories such as functional beverages and sports nutrition
Traditional grocery and mass merchants continue to be main channels for food & beverage, while nutritional supplements and personal care must employ a broader channel strategy
Convenience plays a more significant role in shopping channel selection for food & beverage consumers than other categories
Millennials and Gen X consumers are far more likely to purchase subscriptions, especially for skin care products, compared to Boomers
The 2016 Strategic Hospital Priorities Study examines the current direction of the industry and, in particular, how Medtech companies can capitalize on the many needs of hospital administrators.
While the healthcare market has steadily evolved since L.E.K. Consulting issued its first hospital study in 2010, many of the same trends remain in place — among them consolidation, non-acute care integration, accountability, technology enhancements and novel pricing schemes.
This Executive Insights addresses a number of key topics, including:
Hospital administrator’s chief priorities
Most valuable medtech services
Focus on IT spending
Outlook for outsourcing
Today’s air, rail and cruise/ferry passengers, conditioned by their interactions with retailers, have different expectations from those held in the past. They expect options during travel, require flexible pricing alternatives and value personalized experiences.
While passengers have idle time during transit, they each have different needs based on who they are, the purpose of their travel, and where they are in their journey. This gives transport providers the unique opportunity to leverage retailer best practices and provide a consistent, personalized customer experience.
In this Executive Insights Spotlight on Transport, L.E.K. examines the changing behaviors of passengers and reveals how transport providers must act and think differently to implement a differentiated merchandising strategy — one that truly captivates their passengers with personalized, bundled content and connectivity offerings and makes the most of their time on board.
Spotlight on Technology: Steering Clear of the IT Danger ZonesL.E.K. Consulting
In this Executive Insights' "Spotlight on Technology: Steering Clear of the Danger Zones," learn why companies are increasingly taking advantage of IT services to migrate their industry-specific services to the cloud, how customers are utilizing vendors and which vendors will win by capitalizing on these opportunities.
In the second installment of L.E.K.'s "The Perennial Millennial" Executive Insights spotlight series, we explore the uptake and future interest in Over-The-Top (OTT) services among Millennials by life stage and the potential impact on traditional Pay TV providers.
L.E.K. recently conducted the first in-depth analysis of U.K. Millennials’ media consumption habits by life stage, from living at home with parents all the way through to starting their own families. The research, which covers six life stages, shatters the common assumption that, once millennials are older and have their own children, they revert to more traditional media consumption patterns.
Spotlight on Media & Entertainment: Future of Advertising SpendL.E.K. Consulting
In this latest Executive Insights Spotlight on Media & Entertainment series, L.E.K. uncovers the latest in digital advertising spend and the future of industry consolidation.
Spotlight on Media & Entertainment: Virtual RealityL.E.K. Consulting
As new technologies are developed and price points drop, virtual reality (VR) is poised to take off for some applications. In this Executive Insights’ "Spotlight on Media and Entertainment" series, L.E.K. takes a look at the three different types of VR including Super VR, Medium VR, and Casual Mobile VR.
Maximising Value from Airport Investments – Adopting a Truly Active ApproachL.E.K. Consulting
Leading airports are now transforming into customer-led organizations, with real financial benefits and implications for their business models. L.E.K. experience has shown significant benefits from taking this kind of approach. This presentation looks at Australian and New Zealand airports in the context of this transformation - most have begun the journey, but there is further to go.
Personal Brand Statement:
As an Army veteran dedicated to lifelong learning, I bring a disciplined, strategic mindset to my pursuits. I am constantly expanding my knowledge to innovate and lead effectively. My journey is driven by a commitment to excellence, and to make a meaningful impact in the world.
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Attending a job Interview for B1 and B2 Englsih learnersErika906060
It is a sample of an interview for a business english class for pre-intermediate and intermediate english students with emphasis on the speking ability.
RMD24 | Debunking the non-endemic revenue myth Marvin Vacquier Droop | First ...BBPMedia1
Marvin neemt je in deze presentatie mee in de voordelen van non-endemic advertising op retail media netwerken. Hij brengt ook de uitdagingen in beeld die de markt op dit moment heeft op het gebied van retail media voor niet-leveranciers.
Retail media wordt gezien als het nieuwe advertising-medium en ook mediabureaus richten massaal retail media-afdelingen op. Merken die niet in de betreffende winkel liggen staan ook nog niet in de rij om op de retail media netwerken te adverteren. Marvin belicht de uitdagingen die er zijn om echt aansluiting te vinden op die markt van non-endemic advertising.
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
Affordable Stationery Printing Services in Jaipur | Navpack n PrintNavpack & Print
Looking for professional printing services in Jaipur? Navpack n Print offers high-quality and affordable stationery printing for all your business needs. Stand out with custom stationery designs and fast turnaround times. Contact us today for a quote!
Memorandum Of Association Constitution of Company.pptseri bangash
www.seribangash.com
A Memorandum of Association (MOA) is a legal document that outlines the fundamental principles and objectives upon which a company operates. It serves as the company's charter or constitution and defines the scope of its activities. Here's a detailed note on the MOA:
Contents of Memorandum of Association:
Name Clause: This clause states the name of the company, which should end with words like "Limited" or "Ltd." for a public limited company and "Private Limited" or "Pvt. Ltd." for a private limited company.
https://seribangash.com/article-of-association-is-legal-doc-of-company/
Registered Office Clause: It specifies the location where the company's registered office is situated. This office is where all official communications and notices are sent.
Objective Clause: This clause delineates the main objectives for which the company is formed. It's important to define these objectives clearly, as the company cannot undertake activities beyond those mentioned in this clause.
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Liability Clause: It outlines the extent of liability of the company's members. In the case of companies limited by shares, the liability of members is limited to the amount unpaid on their shares. For companies limited by guarantee, members' liability is limited to the amount they undertake to contribute if the company is wound up.
https://seribangash.com/promotors-is-person-conceived-formation-company/
Capital Clause: This clause specifies the authorized capital of the company, i.e., the maximum amount of share capital the company is authorized to issue. It also mentions the division of this capital into shares and their respective nominal value.
Association Clause: It simply states that the subscribers wish to form a company and agree to become members of it, in accordance with the terms of the MOA.
Importance of Memorandum of Association:
Legal Requirement: The MOA is a legal requirement for the formation of a company. It must be filed with the Registrar of Companies during the incorporation process.
Constitutional Document: It serves as the company's constitutional document, defining its scope, powers, and limitations.
Protection of Members: It protects the interests of the company's members by clearly defining the objectives and limiting their liability.
External Communication: It provides clarity to external parties, such as investors, creditors, and regulatory authorities, regarding the company's objectives and powers.
https://seribangash.com/difference-public-and-private-company-law/
Binding Authority: The company and its members are bound by the provisions of the MOA. Any action taken beyond its scope may be considered ultra vires (beyond the powers) of the company and therefore void.
Amendment of MOA:
While the MOA lays down the company's fundamental principles, it is not entirely immutable. It can be amended, but only under specific circumstances and in compliance with legal procedures. Amendments typically require shareholder
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3.0 Project 2_ Developing My Brand Identity Kit.pptxtanyjahb
A personal brand exploration presentation summarizes an individual's unique qualities and goals, covering strengths, values, passions, and target audience. It helps individuals understand what makes them stand out, their desired image, and how they aim to achieve it.
Enterprise Excellence is Inclusive Excellence.pdfKaiNexus
Enterprise excellence and inclusive excellence are closely linked, and real-world challenges have shown that both are essential to the success of any organization. To achieve enterprise excellence, organizations must focus on improving their operations and processes while creating an inclusive environment that engages everyone. In this interactive session, the facilitator will highlight commonly established business practices and how they limit our ability to engage everyone every day. More importantly, though, participants will likely gain increased awareness of what we can do differently to maximize enterprise excellence through deliberate inclusion.
What is Enterprise Excellence?
Enterprise Excellence is a holistic approach that's aimed at achieving world-class performance across all aspects of the organization.
What might I learn?
A way to engage all in creating Inclusive Excellence. Lessons from the US military and their parallels to the story of Harry Potter. How belt systems and CI teams can destroy inclusive practices. How leadership language invites people to the party. There are three things leaders can do to engage everyone every day: maximizing psychological safety to create environments where folks learn, contribute, and challenge the status quo.
Who might benefit? Anyone and everyone leading folks from the shop floor to top floor.
Dr. William Harvey is a seasoned Operations Leader with extensive experience in chemical processing, manufacturing, and operations management. At Michelman, he currently oversees multiple sites, leading teams in strategic planning and coaching/practicing continuous improvement. William is set to start his eighth year of teaching at the University of Cincinnati where he teaches marketing, finance, and management. William holds various certifications in change management, quality, leadership, operational excellence, team building, and DiSC, among others.
Tata Group Dials Taiwan for Its Chipmaking Ambition in Gujarat’s DholeraAvirahi City Dholera
The Tata Group, a titan of Indian industry, is making waves with its advanced talks with Taiwanese chipmakers Powerchip Semiconductor Manufacturing Corporation (PSMC) and UMC Group. The goal? Establishing a cutting-edge semiconductor fabrication unit (fab) in Dholera, Gujarat. This isn’t just any project; it’s a potential game changer for India’s chipmaking aspirations and a boon for investors seeking promising residential projects in dholera sir.
Visit : https://www.avirahi.com/blog/tata-group-dials-taiwan-for-its-chipmaking-ambition-in-gujarats-dholera/
What is the TDS Return Filing Due Date for FY 2024-25.pdfseoforlegalpillers
It is crucial for the taxpayers to understand about the TDS Return Filing Due Date, so that they can fulfill your TDS obligations efficiently. Taxpayers can avoid penalties by sticking to the deadlines and by accurate filing of TDS. Timely filing of TDS will make sure about the availability of tax credits. You can also seek the professional guidance of experts like Legal Pillers for timely filing of the TDS Return.
What is the TDS Return Filing Due Date for FY 2024-25.pdf
Mergers & Acquisitions: What Winners Do to Beat the Odds
1. L E K . C O ML.E.K. Consulting / Executive Insights
EXECUTIVE INSIGHTS VOLUME XV, ISSUE 16
INSIGHTS @ WORKTM
Flush with cash, bolstered by buoyant share prices, and facing
slow prospects for organic growth in the currently moribund
macroeconomic environment, many executives are on the hunt
for acquisitions. Activity in M&A often comes in bursts; as of
the second quarter of 2013, the scent is in the air.
But capturing value by creating a whole that is greater than
the sum of its parts is a risky game. Recently, L.E.K. Consult-
ing analyzed the performance of more than 2,500 M&A deals
between 1993 and 2010 – a period that included two boom-
and-bust economic cycles. The results were not encouraging.
In the months leading up to the close of a deal, acquirers in
our sample demonstrated healthy performance, generating a
cumulative total shareholder return of about 15% above the
relevant S&P sector index (returns were normalized to remove
market effects). After the close of the deal, however, nearly
60% of companies destroyed shareholder value. Overall, on
average, cumulative total shareholder returns dropped 10%
in the two years following a deal close. In effect, most of the
hard-fought gains leading up to a deal were squandered away.
Performance was poor across the board – in different indus-
tries, when viewed by the size of the deal, and when analyzed
by deals involving bigger companies acquiring smaller ones and
mega-mergers between giants. Performance was even mixed
among more frequent acquirers – although relatively better
compared to deals involving companies that pursue M&A less
frequently. The M&A learning curve is steeper than most com-
panies like to admit (See Figure 1).
Mergers & Acquisitions: What Winners Do to Beat the Odds
Mergers & Acquisitions: What Winners Do to Beat the Odds was written by Michael Connerty, Managing Director in L.E.K. Consulting’s Chicago office and
Bob Lavoie, Managing Director in L.E.K. Consulting’s New York office. Associate Consultant Grayden Webb and Sidney McNabb, Director of U.S.
Information Centers, contributed to this whitepaper.
What’s happening here? In essence, mergers that destroy value
do so because acquirers pay too much for the target because
they overestimate the value gained from the acquisition; they
fail to realize the gains they had predicted because of poor
post-merger execution of the integration; or they do both. Yet
we know that M&A can create value; approximately 40% of
the deals we analyzed involved two companies that turned
out to be more valuable together than apart. What do winners
do differently? How can executives overcome common pitfalls
to beat the long odds of creating value through mergers and
acquisitions? Based on our experience working with companies
across industries and in various types of deals, we believe that
winning acquirers share some universal approaches to the M&A
process. From identifying the right target to synergy valuation
to post-merger integration, winners have shown that with the
right approach, value through M&A can be found and captured.
Winning Acquirers Clearly Define Their
M&A Strategy
An acquiring company that wishes to succeed in M&A must
first clearly identify the problem it wishes to solve through an
acquisition. That is not as simple as it sounds. Consider lagging
revenue growth, a problem that companies often attempt to
solve inorganically. Acquiring companies in your market to build
share, or entering into a new market via an acquisition, are not
sufficiently focused strategies to revitalize revenue streams. The
acquiring company must first identify the specific market seg-
ments it wishes to target, and determine whether that segment
2. EXECUTIVE INSIGHTS
L E K . C O MINSIGHTS @ WORKTM
teams from business units, as well as division and functional
leaders. These are the leaders who will ultimately be account-
able for delivering synergy opportunities, so their early involve-
ment is essential. Star performers and subject-matter experts
are assigned to the teams; their participation entails extra work
beyond their normal responsibilities, so attractive incentives that
include the prospect of career development through M&A are
often required to keep staff focused and motivated. This is no
sacrifice on the part of the company: M&A situations are great
development opportunities for aspiring managers, and should
be communicated as such. Some of the less experienced, but
successful acquirers that recognize their limitations often look
for external support to supplement a taxed management team
and help avoid some of the mistakes others tend to make.
Once the team is in place, it can draw up an M&A playbook
that guides due diligence and integration teams in areas that
commonly need to be addressed such as sales and marketing,
supply chain or back-office functions. The playbook includes
the acquiring company’s baseline financial and operational
performance in areas that are tied to the deal thesis and
potential synergy opportunities with the target company. In
most cases, a company will not have time to quantify a baseline
Page 2 L.E.K. Consulting / Executive Insights Volume XV, Issue 16
EXECUTIVE INSIGHTS
can best be reached by acquiring another firm. Who are the
customers? Where are they? What products or service will they
buy? L.E.K. Consulting has written extensively about “Strategic
Market Position” (SMP) – the need to target the specific market
segments where abundant value hides rather than clumsily
chasing market share for its own sake.1
Winning acquirers
challenge their internal understanding of their targeted
segments and expectations for segment growth compared to
internal growth expectations. A pre-requisite for all successful
M&A efforts is clear, thesis-driven deal criteria, aligned with
the company’s broader strategic plan and objectives.
Once a company has determined its M&A strategy and deal
criteria, it faces the temptation to head straight out on the
hunt. Winning acquirers don’t do this. They make sure to pre-
pare their organization for the upcoming journey by outlining
in advance a clear deal process that delineates roles and respon-
sibilities for staff. Early planning is paramount. Performing this
vital task on the fly once due diligence has been initiated often
results in confusion and missed diligence opportunities. Win-
ning acquirers define roles, responsibilities, governance and de-
cision-making for those likely to be involved in the deal process
well before due diligence is underway. They assemble diligence
1
Stuart Jackson, Where Value Hides: A New Way to Uncover Profitable Growth for Your Business (Hoboken: John Wiley and Sons, 2007).
Acquirers' Cumulative Total Shareholder Return
Figure 1
Percent(%)
5
Source: CAPIQ data, L.E.K. analysis
Methodology Notes: All deals greater than $50M in transaction value, 100% control transactions, and completed during the 1993-2010 period by public acquirers; U.S. primary location of the
acquirer and target; acquirers’ total shareholder returns were compared against S&P 500 sector and composite indices to normalize for market-related performance (S&P 500 composite index was
used in the earlier sample years prior to when sector indices were created); excludes REITs
Deal
close
20
15
10
5
0
25
-6 months-12 months-18 months-24 months +24 months+18 months+12 months+6 months
Shareholder value destroyed
post acquisitionCompanies that make acquisitions
tend to have experienced strong
returns in the months leading up
to the deal
Returns begin to stabilize
~20 months post close
Cumulative 2 Year TSR
Above Sector Index
2 years prior
15.3%
2 years post
(9.9)%
3. EXECUTIVE INSIGHTS
L E K . C O MINSIGHTS @ WORKTM
L.E.K. Consulting / Executive Insights
performance during the short due diligence period, so this
analysis must be completed well in advance. Accurately estimat-
ing revenue synergy – which is often the most difficult type of
synergy to realize – requires particularly detailed assessments
down to the account level. That can be a daunting task in the
pressure-packed pre-close period, which is another reason why
involving the right team early is essential. (For more on captur-
ing revenue synergies, see sidebar on page 5).
The playbook can be amended through the M&A process, and
through various deals over time. Eventually, it should be treated
as an asset of the company – a key tool to institutionalize learn-
ing for future acquisitions.
Winning Acquirers Get the Price Right
With a clearly defined M&A strategy and a well-prepared
organization, acquirers are in a much stronger position to avoid
overpaying for their target. Almost all mergers today attempt
to create value through some mix of revenue and cost syner-
gies between companies. Determining the right price for a
deal rests upon a company’s ability to develop estimates that
are grounded in the market and operations of the businesses,
and overcome internal biases that may wrongly influence such
estimates.
As an example, L.E.K. recently helped a client in the global
industrial equipment and services business to identify revenue
synergies for an acquisition target. The client wished to test its
assumptions about how well the target company was posi-
tioned in various market and geographic segments in order to
estimate to what extent products and services could be pulled
through the client’s sales force and channel partners. The client
came to L.E.K. with very optimistic predictions about post-
merger growth.
L.E.K. scrutinized the client’s assumptions that customers were
interested in a combined product and service portfolio of the
two companies. Using data-driven analysis, including input from
customers and other market participants, we found that rev-
enue synergy existed, but not likely at the magnitude our client
had predicted. Armed with this insight, the client recalibrated
and ultimately negotiated a purchase price that was roughly
15% lower than it originally estimated it should pay.
As the above example illustrates, investigative research and
analysis can improve the accuracy of synergy estimates by test-
ing assumptions of a potential combined company’s products
and services against market, customer and competitor realities.
Revenue dis-synergies from the elimination of some products,
pricing adjustments in the combined portfolio or customer
share of wallet limits can be quantified and layered into esti-
mates. Broad-brush or gut-feel assumptions can be put under
scrutiny, and eventually rooted out.
Successful acquirers take a similar approach to estimating cost
synergies. They avoid generalized assumptions (e.g., "we think
we can save 5% on costs."). Instead, they focus on defining
the right operating model and linking cost drivers, operat-
ing practices and performance between acquirer and target.
Identifying upfront the preferred operating model for a given
functional area
for the combined
company makes it
much easier for the
diligence team to
develop detailed
cost synergies.
Major business
processes and the costs to generate corresponding outputs can
then be mapped between the acquirer and target company to
help estimate cost differentials and potential synergy opportuni-
ties. Migrating to the acquirer’s back-office model, outsourcing
a particular process, or consolidating production and distribu-
tion locations are all examples of early operating model deci-
sions that give the right focus on assessing cost synergies. Un-
derstandably, the typical deal timeline and limitations on sharing
competitively sensitive information can create challenges to
this process. Successful acquirers leverage their own advance
preparations, consult service providers such as outsourcing
partners, and use consultants to staff third-party "clean teams"
to maximize accuracy in the face of tight deadlines and limited
access to information.
Of all the value drivers,
revenue synergy is often
the most difficult to realize.
4. EXECUTIVE INSIGHTS
L E K . C O MINSIGHTS @ WORKTM
Page 4 L.E.K. Consulting / Executive Insights Volume XV, Issue 16
Underestimating the time and cost to achieve synergies is a
classic M&A mistake that the best companies carefully avoid.
Not all synergies are created equal; some are more difficult
to realize than others. Successful acquirers focus on the most
impactful synergy opportunities first to understand what they
can control to ensure success and what they have less control
over that requires a different set of tactics. Additionally, they
carefully gauge the level of complexity associated with a given
opportunity. As Figure 2 shows, there are a wide variety of
potential synergy opportunities that have different profiles
along the dimensions of control and complexity.
High control/low complexity synergy opportunities are typical
“quick win” candidates. Indirect procurement savings oppor-
tunities are a common example – they are easy to identify, the
tactical steps to realize them are straightforward and control is
typically high as vendors often anticipate these efforts following
mergers and are eager to maintain or win new business with
the combined company. Successful acquirers then focus their
due diligence efforts on identifying specific spend categories
that can be sourced – sizing the opportunity and defining the
integration plans to realize the savings.
At the other end of the complexity/control spectrum is new
product and service growth opportunities. Entering new mar-
kets, developing new products and services, growing share in
a channel – these are complex undertakings and may involve
some combination of developing new products or services,
market research and testing, prototyping and running pilots,
sales and customer service preparations, distributor and channel
negotiations, and scaling up production or service delivery, to
name only a few. Such opportunities are hard to realize even
in organic situations let alone in mergers and acquisitions when
a company is simultaneously undergoing profound organiza-
tional changes. Complicating the task even further still, control
in these situations is low given the ultimate measure of success
is determined by the level of acceptance by customers and
sales growth.
For these opportunities, successful acquirers plan differently.
With a clear understanding of what problems they are trying to
solve with an acquisition, they know their internal performance,
what customers think of them and what they need, what
opportunities exist in the market and how the target company
will help solve the problem. Significant time and energy is put
into understanding the integration and operational require-
ments to follow through on the opportunity, the costs to
achieve potential synergy benefits, the risks that need to be
proactively managed and the organizational barriers that
must be overcome. These factors are incorporated into target
company valuations and negotiations as the time and costs to
achieve high-potential, complex/low control synergy opportuni-
ties are easy to underestimate.
Winning Acquirers Use a Structured
Approach to Post-Merger Integration
We believe the best acquirers are also methodical in their ap-
proach to post-merger integration (PMI). There can be no single
recipe book for an undertaking as complex as combining two
companies. In our experience, however, we have noticed that
successful companies fulfill six requirements during the integra-
tion process:
M&A Synergies – Control vs. Complexity
Figure 2
Source: L.E.K. research and experience
Complexity HighLow
HighControlLow
Opportunity Size
Indirect
Sourcing
Redundant
Positions
Corporate
Admin
Quick Wins
Difficult
to Obtain
Sales Force/
Cross-Selling
Strategic
Sourcing
New Customers
New
Products/
Services
Product
Rationalization
Rationalize
Distribution
Centers
Back-Office
Consolidation
Manufacturing
Consolidation
5. EXECUTIVE INSIGHTS
L E K . C O MINSIGHTS @ WORKTM
L.E.K. Consulting / Executive Insights
• Strong Senior Leadership and Broad Organizational
Buy-In: As a first priority, successful acquirers set
the senior leadership team quickly for the combined
organization. Roles, accountability and reporting
structures are clearly delineated before a long-term
structure is established. Senior leaders remain visible and
open throughout the process; they work tirelessly to en-
sure the organization understands the vision, rationale
and plan for the combined company. Commitments are
gained pre-close and reaffirmed post-close to see the
integration through and realize the expected benefits.
• Disciplined Focus on Value Drivers: The key value
drivers behind a deal are always front and center for
executives and the integration team (and are often tied
to incentives). Discrete work streams are organized
around the value drivers and key enabling functions of
those value drivers. Metrics are identified to quantify
how each specific value driver will be achieved and
linked to integration plans (i.e., the ‘leading indicators’
of synergy realization).
Realizing Elusive Revenue Synergies
Of all the value drivers that underpin mergers, revenue synergies can be the most difficult to realize. This is because com-
panies too often make assumptions about revenue enhancements following a deal without grounding them in market or
operational realities, or clearly understanding how the synergies will be achieved. For instance, a common revenue synergy
tactic is to cross-sell products and services of both the acquirer and target post-merger. But a company must first be sure that
customers who buy products from Company A will also be interested in purchasing the wares of Company B. Then it must
be sure that customers have the ability to do so: sales teams from both companies must be quickly trained to sell the other’s
products and services, and rewarded sufficiently for doing so. In the very short term, the order-to-cash process may need to
be “band-aided” to ensure any customer can call the customer service center they have used in the past, or go on a website
to place an order for any product in the combined portfolio.
Long-term integration and optimization of customer service centers and ERP and CRM systems can wait; winners develop a
work around quickly to ensure customers get what they want. In fact, some successful acquirers launch promotions to stimu-
late short-term demand during the early post-close period to help ensure revenue synergies materialize and to keep competi-
tors from poaching. These promotions, combined with a ready-to-go sales team, can be a powerful combination in the crucial
first few months following an acquisition.
Often, the key strategic imperative is speed. For example, we recently worked with a medical products company to estimate
potential synergies between its sizable distribution and sales capacities and a target company that was about to release a
next generation product that had very high growth expectations. The key to realizing the synergy was maximizing the speed
at which the acquirer could absorb the new product and get out in front of competitors before they were able to introduce
their own next generation products. We worked closely with our client to map out the fastest route to market upon close of a
deal. Operational barriers were identified and steps were planned to overcome them with short-term workarounds. Data and
systems were bridged to support customer interfaces. Frequent, cross-functional planning sessions aligned dependencies and
sequenced the critical steps. Thanks to the advance preparation, the new product hit the market within several weeks of the
deal closing, and customers were excited to get their hands on it. The success all tied back to the pre-close effort to under-
stand what it would take to operationalize the revenue opportunity, and realize its full value.
6. EXECUTIVE INSIGHTS
L E K . C O MINSIGHTS @ WORKTM
Page 6 L.E.K. Consulting / Executive Insights Volume XV, Issue 16
• Dedicated Integration Teams: Dedicated integration
teams are critical to meeting integration milestones. As
noted earlier, successful acquirers begin integration plan-
ning well before close. Additional team members are
brought in once operating model decisions are made
and clear guidance can be provided to further define the
integration plans. An Integration Management Office is
established to oversee the development and execution
of integration plans, challenge the teams to meet their
objectives and push the pace of integration.
• Robust Implementation Plans: Detailed integration
plans are put in place before close, and validated post-
close, to ensure continuity of day-to-day operations
while addressing immediate needs (e.g., supporting
customers and employees). Clear, definable objectives
are set for Day One, the first 100 days and the first year.
Attention to detail – sequencing and identifying inter-
dependencies and risks across functional and organiza-
tional boundaries – is crucial when laying out these
objectives.
• A Strong Talent Retention Program: The best
acquirers view acquisitions as an opportunity to top-
grade their overall talent pool – employees from both
legacy companies compete for important positions.
Flight risks in key functions are identified early and
retention plans are put in place. Money is not always
the answer; often new career development opportuni-
ties and fresh leadership can inspire people to stay and
perform well. Nonetheless, contingency plans are put in
place should key employees leave unexpectedly.
• An ‘Overcommunication’ Strategy: Winning compa-
nies address stakeholder concerns and interest early
and often. Questions are proactively addressed by devel-
oping consistent messaging and communication that is
tailored for key stakeholders (e.g., employees, custom-
ers, partners, etc.). For employees, basic questions are
addressed first: Do I still have a job? What do I stand
to gain from this merger? Companies often under-
communicate key integration milestones and don’t
provide the message repetition that is required to help
distracted audiences understand the value of the deal,
and what it means for them. A well-structured com-
munication plan is instrumental in supporting the
organization as it moves through various stages of
integration to achieve its goals.
Beating the Odds
Our research into M&A performance shows that creating value
through M&A is a daunting prospect. But our experience work-
ing with clients suggests otherwise. We’ve helped scores of
companies identify and capture value through acquisitions.
Success starts with building a focused M&A strategy, establish-
ing deal criteria and identifying targets. Synergy assumptions
must then be put under intense analytical scrutiny and ground-
ed in market, customer, competitor and operational realities
to arrive at the right price. After that, it all comes down to
realizing the gains identified on paper – successful post-merger
integration. Integrations are typically a complex undertaking,
but the best acquirers employ a structured approach to
manage organizational changes, create shareholder value
and beat the odds.