Acquisition search, delivery & effective integration

I am a Chelsea fan. Please read on… there is a point to this!

For those who don’t know, I’ve been a Chelsea fan for 30 years and in 2014/15 Chelsea won the Premier League, but in 2015/16 almost the same group of players managed to finish 10th.

Now I could take this analogy on to talk about inspiring managers, team motivation and the right strategies, but instead I’m going to focus on acquisition search and making the right pieces fit at the right time.

Chelsea’s first new player signing for the 2016/17 season was the midfield workhorse from Leicester N’Golo Kanté. Leicester defied 5000/1 odds to win the league in 2015/16 and since his move to Chelsea many have put Leicester’s success and Chelsea’s subsequent success (I hope) in 2016/17 down to him and Chelsea’s signing of him.

He was the right target, at the right time, integrated into the team quickly, in the right formation and provided the missing ingredient to enable the team to progress.

This analogy is how you should approach a potential acquisition for your business and make it a success. The six steps below show a summary of this in action:

1. First you must understand your own business, where are its strengths, weaknesses, opportunities and threats. How do you sit in the market place and what is that market around you doing.
   Many times I’ve heard business owners say that “we’re now doing X because that is where the business took us”. This isn’t a bad thing, but what if you can steer your business and its growth using strategically focussed and targeted acquisitions that you know are going to make a difference to your business.
2. Once you understand your wish list, go and look for them. Often the best place to start is on market. There are usually a few businesses for sale that broadly match your criteria. Have a look at these, invariably they are not right for you, but will help refine your search criteria.
3. When you are happy with your acquisition target criteria, then you need to go off market and search for these. Trade associations, companies house and our good friend Google can all help to unearth the right targets.
4. The searching is the work of your football scouts. When it comes to approaching, there aren’t hard and fast rules on how to approach these targets, but discretion and confidentiality are paramount.
5. Once you are in-front of your favourite targets, asking the questions you need the answers to will be much easier than if you are offered an acquisition opportunity, and don’t know what you want or why. If the target looks good and ticks many of your search criteria, then you will be confident in making an offer and concluding the acquisition itself.
6. The work of course doesn’t stop there. Planning and implementing the integration of both businesses is key to delivering the successful growth you predicted through the acquisition. Very often, this is all about people.

If N’Golo Kanté isn’t respected by the other Chelsea stars, or he isn’t welcomed into the team, or his role isn’t made clear by the manager pre, during and post-acquisition, those team strengthening qualities you expected, may not materialise.

In summary
Planning, finding, reviewing and comparing, offering, negotiating, concluding and integrating acquisitions to help grow your business is a role we can undertake alongside you at Forward Corporate Finance. If this is something you are considering now, or at some point in the future, please do get in touch.

Finally, don’t ask me if Arsenal should keep Arsene Wenger as manager, I haven’t done the SWOT analysis on him and Arsenal Football Club, or the acquisition search in the market to see if there is statistically a better potential manager for the Gunners. I’d like him to stay!

Rob Dukelow-Smith