What are Mergers & Acquisitions (M&A), and what are best practices, tools and online templates for teams and organizations?
Definition of Mergers & Acquisitions (M&A)
Mergers and acquisitions (M&A) is a general term used to describe the consolidation of companies by various means, such as mergers, acquisitions, tender offers, consolidations, purchase of assets or management acquisitions.
Mergers & Acquisitions (M&A)
Mergers and Acquisitions are two terms often used interchangeably, but they actually have slightly different meanings. A Merger is when two companies, usually approximately the same size, decide to move forward as one entity in order to strengthen their market position in an industry. Both company’s stocks are surrendered and replaced with new stock representing the new company. An Acquisition, on the other hand, is when one company takes over another company, and the original company ceases to exist. The purchasing company’s stock takes over and is generally strengthened with the purchase. Acquisitions can sometimes be regarded as a “takeover,” since the target company may not necessarily want to be purchased.
Other types of transactions that fall under the M&A umbrella include:
- Tender Offer: In this type of transaction, one company agrees to purchase the outstanding stock of another company, at a price they specify. Most tender offers ultimately result in a merger.
- Consolidation: A consolidation creates a new company out of two existing companies. In this case, stockholders of both companies must approve the change.
- Purchase of Assets: In this case, one company acquires the assets of another company, and the company whose assets are being acquired must get approval from its shareholders.
- Management Acquisitions: In this case, also knows as a Management-Led Buyout, executives purchase a controlling interest in another company, making it private.
There are various benefits to combining two companies into one, regardless of the method used, including:
- Better economies of scale
- Increased market share
- Expanded distribution capabilities
- Decreased labor cost due to reductions in staffing duplications
- Improved labor talent due to the larger pool of available labor
- Improved financial resources
Mergers & Acquisitions as a strategy is often successful for companies wishing to quickly increase in size, service area, talent pool, customer base, or financial resources. Since the process can also be financially taxing, the companies involved need to be sure there are substantial advantages that will occur through the transaction.
Tools & Templates
Various tools and templates for M&A assessment and management can be used including spreadsheets, financial software, presentations and more.
upBOARD's Online Mergers & Acquisitions Tools & Templates
Unlike most traditional Mergers & Acquisitions processes, upBOARD’s online M&A tools allow any team or organization to instantly begin working with our web templates and input forms. Our digital platform goes far beyond other software tools by including progress dashboards, data integration from existing documents or other SaaS software, elegant intuitive designs, and full access on any desktop or mobile device.
Learn more about upBOARD’s portfolio of other business strategy best practice tools and templates, including:
2 X 2 Matrix, ADL Matrix, Affinity Diagrams, Baker’s 4 Strategies of Influence, Balanced Scorecard, Benchmarking, Blue Ocean Strategy, Bowman Strategy Clock, Build-Measure-Learn Feedback Loop, Business Model Canvas, CAGE Distance Framework, Competitive Analysis, Competitive Landscape Analysis, Contingency Planning, Core Competence Analysis, Critical Success Factors, Discovery Driven Planning, Economic Value Added, First Mover Advantage, Five Forces Model, Force Field Analysis, Gap Analysis, GE McKinsey 9-Box Matrix, Go To Market Strategy, Hambrick & Frederickson’s Strategy Diamond, Hedgehog Model, Hook Model of Behavioral Design, Hoshin Planning System, Kay’s Distinctive Capabilities Framework, Key Outcome Indicators, Kotler’s Five Product Levels Model, Kotler’s Pricing Strategies, Lafley & Martin’s Five Step Strategy Model, McKinsey 7S Model, McKinsey’s Seven Degrees of Freedom for Growth, Mergers & Acquisitions, Mission Statements, Mullin’s Seven Domains Model, OGSM Framework, Ohmae’s 3-C’s Model, Partner Relationship Management, PEST Analysis, PESTLE Analysis, Porter’s Diamond, Portfolio Management, Purpose Statements, Pyramid of Purpose, Scenario Planning, Simonson & Rosen’s Influence Mix, SMART Performance Metrics, SMARTER Goals, SOAR, Strategic Goals, Strategy Map, Strategy Roadmap, Strategy Uncertainty Map, SWOT Analysis, TOWS Matrix, Triple Bottom Line, USP Analysis, Value Chain Analysis, Value Disciplines Model, Value Net Model, Values Statement, Vision Statements, VRIO Analysis, and Weisbord’s Six-Box Model.