Is there a better M&A model ?
image source : https://diffzi.com/merger-vs-acquisition/ Have been challenged to rethink certain growth models and the often significant issues created by: buy, merge and acquire thinking as opposed to invest and build. The data (success as value created as realized in 3 years as per plan) from BigCo takes over MinnowCo is not good (1 in 10 achieve above plan), the same type of data from BigCo takes over SmallCo is no better with only 8 in 100 achieving plan. Near equal size takeover/ merger of BigCo and BigCo is unknown on plan, but market data would suggest it is not great either. On a pure financial measure as a decision, surly the risk class of M&A activity for value creation would be near junk level, In all other classes of risk - such activities would not be approved. However, there is way more at stake than pure financial metrics such as exits, vesting, relalisable gain, bonuses and incentives. Assumption 1 + 1 = 3. ...