Companies Merger and Acquisition processes are activities with a high risk that face a wide set of contingencies. During signing, participating companies must manage several risks, called transactional, that can abort the operation.
To minimize those risks, companies must adopt different strategies adapted to the process evolution.
Likewise, contingencies may appear in the post-merger, which is when the investment company checks what it has bought. Most of these risks must early be detected in the “Due Diligence”, that remember us the importance of making a correct analysis. There are other risks that are more difficult to detect and that depend on how the integration process is structured, the speed of this and the leadership of the management team that manages the operation.
Risks can be named into three categories:
The risks of the beneficiaries:
- Loss of investor confidence.
- Key employees exit.
- Loss of customers.
Execution risks:
- Incompatibility of computer systems.
- Inability to finish projects on time.
- Inability to achieve intermediate goals.
Risks of default on merger promises.
WE ADVISE YOU IN RISK MANAGEMENT AND ORGANIZE THE ACTIONS AS THE FOLLOWING:
1. We set priorities between the different projects, depending on the importance degree for the company's activity and the complexity depending on the used resources.
2. We identify issues, adopt assumptions and determine risks.
3. We classify the risks due to their urgency. The most important are those that can cancel the operation.
4. We attack strongly risks that can be overcome and minimize the impact of those that cannot be easily and quickly reduced.
IN ATICA BUSINESS BROKERS WE HELP YOU MINIMIZING RISKS!
