ACQUISITION SCREENING
Screening starts with a clearly articulated M&A strategy, which is an extension of a company's overall growth strategy. In its M&A strategy, a company should define the role an acquisition needs to play, before it looks at targets.Companies should screen candidates based on the why and the how, with a focused search that not only identifies the right targets but also gives a head start on the strategic due diligence process.
Every deal a company proposes to do-big or small, strategic or tactical-should start with an investment thesis, a clear statement of how that particular deal will create value for the company. The problem is, less than 30% of acquiring executives start out with an investment thesis that stands the test of time, according to research.
Scientia's experience in acquisition screening
Scientia has screened thousands of companies for its financial and corporate buyer clients. The screening process typically follows four steps:
- Generate full list of acquisition targets
- Screen targets based on criteria set in the M&A strategy
- Develop detailed profile, investment thesis and valuation for top-priority targets
- Build M&A road map that spells out sequence and timing
- Devise plan to approach targets and develop relationships with them
