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Monday, December 16, 2013

Useful tips for businesses when conducting a merger

By Chris Mayhew

Successful businesses are always on the lookout for new ways to grow and one of the best ways of doing this can be to merge your company with another business so as to increase your client base, resources and overall power in the market. However, whilst a merger can be an exciting and interesting time, it’s not always the easiest thing to conduct due to its complexity.

Pulling off the right deal will be massive for your company and so there will obviously be a need to get everything right throughout the whole process. Here are some great tips for any business owners attempting to carry out a merger.

Ensure it’s right for your business

The decision to merge with another business is an important one and so it’s critical that you are totally sure that this is the right choice for your business at this point in time. The main thing to ask is whether the merging of your company with another one is going to be more cost-effective than if you invested the same amount of money into your current business. If this is not the case then it is hard to justify merging at this point.

Other things to think about are whether you are financially stable enough to go through this right now, how much the other company is going to bring to the table and how well you are going to be able to work with the other business owner.

Understand what’s involved

Obviously you won’t be taking the merger lightly, but it is important to be sure that you are clear on everything involved in the process. It is likely to be an up and down journey that could be drawn out for some time and so you may have to strap yourself in and take the bad with the good during certain times. Research everything you need to know thoroughly so that there can be no nasty surprises along the way.

Communicate at all times

Throughout the process there is sure to be lots of uncertainty and questions from your team and from members of the business you are merging with, and so communication is key. Try to keep your staff in the know as much as possible, whilst explaining to them how much of an opportunity this is and that it is a great move for the company. Keep in regular contact with your soon to be business partner too so that any issues which arise can be ironed out before they cause too much of an interruption to the development of the merger or your clients and customers.

Seek professional legal advice

Unsurprisingly, there is a big legal element involved in conducting a merger and so without advice from a reputable law firm, like this one in Bristol, you could come unstuck. Most of these legal issues are complex and so you are sure to benefit from the advice offered in order to be certain that everything is conducted in the right way and no loose ends are left untied.

A business lawyer will be able to help you with due diligence (the process of understanding and confirming the financial assets which are owned by the company you have proposed a merger with) and will be with you every step of the way to advise you on key decisions, aid you in protecting your own assets and help you negotiate the best deal for you and your business.

About the author: Chris Mayhew has plans to create his own business one day and is interested in the intricacies of business law. He would recommend AMD Solicitors, a Bristol law firm, to any business owner looking for advice surrounding mergers and acquisitions