Mergers

Mergers are inherently risky. A KPMG study carried out in the UK in 2002 found that “half of the (merger and acquisition) deals analysed either failed to deliver or actively destroyed shareholder value”. Beating the Bears, KPMG, 2002

One of the big risks to any business in contemplating a merger is the human factor yet it often receives little consideration. The commitment of the management team and employees is a key to any merger.

Differences in the culture of the organisations can be a make or break issue.  Merger Plus™ is a tool to help evaluate the key element of risk in exploring a merger and to assist in mitigating risk where the decision is to proceed.

Merger Plus™ focuses on understanding the differing cultures between organisations and using that knowledge to assist in making go/no go decisions and in adopting good management approaches where the decision is made to proceed with a merger.

It can take some of the “ego factor” out of merger decision making.

Using Merger Plus™ can provide:

  • a means of balancing the people risks along with other risks in evaluating a merger
  • for retaining what is special about each party to a merger as well as better consolidating forecast gains from the other synergies expected from the merger
  • a route for bringing about culture change in a consenting manner

Merger Plus™ is an approach developed by the Virtual Group in consultation with businesses involved in mergers.

For more information contact: Bruce Holland or Allan Frazer.

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