Every industry leader has engaged in mergers and acquisitions at some point, whether to purchase a competitor, expand into new markets, or get access to intellectual property or technology. Whatever their motivation, all of these businesses will have followed a reasonably well-defined series of actions to complete the transaction.

Working with hundreds of dealmakers over the years has given DealRoom valuable insight into the process.This book seeks to provide insight into the M&A process, whether you’re on the buying or selling end of the transaction.

What is the M&A (mergers and acquisitions) process?

The M&A process describes how deals are put together from beginning to end.

Bad processes frequently derail what appear to be solid bargains. As the greatest project management process for any firm, the manner in which it is carried out has the potential to either unleash or destroy millions of dollars in value.

If M&A is utilized to alter a company, the M&A process must be transformed as well.

Timeline of the Mergers and Acquisitions Process

Because DealRoom is a proponent of Agile M&A, the M&A process schedule we provide differs from that offered elsewhere.

The graph below illustrates our thoughts on how this timeframe should unfold:

Traditional vs. Agile M&A Process Timelines

  • Getting the timescales correct is critical in any M&A deal. What happens when is critical to the relative success of the finished outcome, just as it is to the relative success of a cuisine that combines several elements.
  • Larger agreements may not necessitate more time, but they do necessitate more resources (i.e., bigger deal teams).
  • In general, this procedure should take up to 6 months, but take advantage of every chance to learn from prior processes and improve the efficiency of subsequent workflows.

An Overview of the Mergers and Acquisitions Process

The mergers and acquisitions (M&A) process involves multiple phases and can take anything from six months to several years to complete. We’ll walk you through the acquisition process from beginning to end, explain the different sorts of acquisitions (strategic vs. financial buys), examine the value of synergies (hard and soft synergies), and identify transaction expenses in this guide. Watch our free video course on mergers and acquisitions to discover all you need to know about the M&A process.

M&A Process in Steps

You’ll need to build an M&A deal procedure if you operate in investment banking or corporate development. Investment bankers provide guidance to their customers (CEOs, CFOs, and corporate development professionals) on the numerous M&A processes involved in this process.

A typical M&A deal involves the following steps:

  1. Develop an acquisition plan: A solid acquisition strategy starts with the acquirer having a clear notion of what they want to achieve from the purchase — what their business goal is in purchasing the target firm (e.g., expanding product lines or gaining access to new markets).
  2. Establish M&A search criteria – Finding the most important criteria for identifying possible target firms (e.g., profit margins, geographic location, or customer base)
  3. Search for and analyze possible acquisition targets: The acquirer searches for and evaluates potential acquisition targets using the search parameters they’ve established.

The acquirer contacts one or more firms that satisfy its search criteria and looks to provide excellent value; the goal of the early talks is to obtain further information and determine whether the target company is open to a merger or acquisition.