The Deal Life Cycle

The deal life cycle Phase M&A explanation Typical goals Origination: Informal due This phase happens after the buyer has determined its overall ƒ Determine the target’s strategic fit in corporate or business unit diligence and first integration growth strategy and how acquisitions might support growth. strategy plan ƒ Discuss deal feasibility and initial price range The starting point for this article is when the buyer has identified a Legal Milestone: No target. The first conversations begin with the potential target. ƒ Assess how the target generates value requirement, a company ƒ Evaluate the target’s leadership and gather their views on the decision Limitations: This takes place without real detailed knowledge of deal strategy, and integration options that would enhance deal the target. success Buyer begins allocating ƒ Determine initial integration strategy resources and capital for this phase and the next ƒ Assess deal specific goals, including synergy goals ƒ Develop preliminary business proposition to persuade seller to sell to buyer (instead of some other firm, or not sell at all) ƒ Identify risks and priority areas for investigation in next phase ƒ Determine whether to proceed to formal due diligence