Comprehensive Guide to Mergers & Acquisitions, A: Managing the Critical Success Factors Across Every Stage of the M&A Process

Leverage today's most complete and practical framework for driving superior business value from mergers and acquisitions -- both domestic and international. A Comprehensive Guide to Mergers and Acquisitions Management focuses on critical success factors across every stage of the process, including planning, screening, negotiation, due diligence, transition management structures, post-merger integration, leadership and trust, cultural integration, HR practices, control, monitoring, and more. Authored by Yaakov Weber, an international expert in M&A management, strategic alliances, and strategic management, this book's uniquely interdisciplinary approach fully addresses both operational and cultural requirements, supporting participants in every role. Replete with recent examples and cases, it pays special attention to crucial strategic and behavioral linkages between pre- and post-merger stages, explaining why they are so important and how they can be managed to create maximum value. Throughout, Weber provides practical tools, tables, and figures that can help M&A implementers ensure best performance and achieve success where others have failed. As just one example, he provides proven instruments for analyzing cultural differences and the potential for synergy, and translating that potential into reality. For multiple audiences, including board members and top executives who must evaluate the strategic and financial issues associated with M&A; investment bankers, VCs, and other investors who must screen and select acquisitions; managers who must execute business combinations; consultants in strategy, HR, culture, and other areas; and faculty and students in executive education, MBA, and BA-level business programs.

Table of Contents:
Preface    xvi Part I  Value Creation Model for Mergers and Acquisitions    1 Chapter  1  The M&A Paradox: Factors of Success and Failure in Mergers and Acquisitions    3 Finance and the Capital Market    5 Strategic Management    7 Organizational Behavior    9 References    11 Chapter  2  An Integrated Model for Value Creation in Mergers and Acquisitions    13 Overview    13 Different Disciplines, Different Stages, No Interrelationships    14 An Integrated Model for Value Creation in M&A    17 Stage I: Planning and Strategic Management    18 1 Strategic Management, Goals, and M&A Strategy    18 2 Searching, Screening, and Selection    19 3 Financial and Strategic Estimate, Including Synergy Analysis and Corporate Culture Differences    19 4 Integration Planning    20 Stage II: Negotiation, Due Diligence, and Agreement    20 1 The Negotiation Processes    20 2 Assessment of Due Diligence    21 Stage III: Integrating the Organizations    22 1 Approaches to Integration, Cultural Differences, and Human Capital Integration    22 2 Leadership and Integration Infrastructure    23 3 Stress and Tension    23 4 Communication Strategy    24 5 Cultural Assessment and Cultural Integration    24 6 Integration Approaches    25 7 Evaluation, Control, and Feedback    26 Conclusion    26 References    27 Chapter  3  Strategic Motives and Considerations    29 Introduction    29 Strategic Motives for an M&A    29 Synergy    30 Market Power    31 Diversification    31 Financial and Tax Issues    32 Valuation Ratio    32 Agency Theory    32 The Strategic Management of M&As as Part of Corporate and Competitive Strategies    33 References    36 Chapter  4  M&A Strategic Decisions .37 Decision    1: Should the M&A be Part of the Current Strategy?    37 Decision    2: Choice of the Appropriate Partner for the M&A: Strategic Fit and Post-Merger Integration (PMI)    40 Diversification: Two Main Types of M&As    41 Entering into a New Industry    41 Unrelated Diversification: New Business    42 Related Diversification    43 Joint Ventures    47 Strategic Outsourcing    48 Reference    49 Part II  Analysis Tools for Key Success Factors    51 Chapter  5  Synergy Potential and Realization    53 Introduction    53 Sources of Synergies    53 Sharing Resources    54 Knowledge, Skills, and Capabilities Transfer    54 Types of Knowledge    55 Knowledge Transfer Process    56 Issues of Knowledge Transfer    57 Enable Knowledge Transfer    58 Knowledge Transfer in Technology and Innovation-Intensive Acquisitions    59 Knowledge Transfer of General Management Skills and Capabilities    60 Other Benefits of the M&A    60 Analysis of Synergy Potential    61 Horizontal Mergers    61 Vertical Integration    62 Saving on Expenses    63 Assurance of Supply or Demand    64 Improvement of Competitive Advantage    64 Disadvantages of Vertical Integration    65 References    68 Chapter  6  Culture and Cultural Differences Analysis    69 Introduction    69 The Importance and Advantages of Evaluation and Measurement of Differences of Management Culture    70 What Is Organizational Culture?    71 Dimensions of Organizational Culture    72 1 Approach to Innovation and Activity    73 2 Approach to Risk-Taking    73 3 Lateral Interdependence: Horizontal Relationship    73 4 Top Management Contact: Vertical-Hierarchical Contact    74 5 Autonomy and Decision Making    74 6 Approach to Performances    74 7 Approach to Rewards    75 Measurement and Evaluation of Cultural Differences    76 Using Cultural Differences Analysis in All M&A Stages    79 Conclusion    81 References    81 Chapter  7  Searching, Screening, and Selection of M&A Alternatives    83 The Process of Search and Identification    83 Establishment of a Business Development Unit    84 Determination of Criteria for the Search and Screening    86 Determination of Search Strategy    92 Independent Search Plan    92 Search through Agents    93 Approaching the Target Company    94 Friendly Approach    95 Making-the-Most-of-the-Opportunity Approach    95 Hostile Approach    95 References    97 Part III  Negotiation    99 Chapter  8  Selection of Target and Negotiation Process    101 Choice of Partner    102 Sources of Information    105 Evaluation of the Target    107 Price Valuation    109 Negotiation    110 References    123 Chapter  9  Extended Due Diligence Examination and Summative Evaluation for M&As    127 The Process and Goals of Due Diligence    127 Extension of the Due Diligence Examination    128 Topics for the Examination of Due Diligence    129 Legal Topics    130 Business and Operational Topics    132 Due Diligence Examination of Organizational Culture    136 Evaluations Regarding Synergy Potential and Realization    137 Chapter  10  Agreements    141 Letter of Intention (LOI) or Memorandum of Understanding (MOU)    141 The Acquisition Agreement    145 How to Be Helped by Lawyers    147 Part IV  Post-Merger Integration and Implementation    149 Chapter  11  Management of Culture Clash    151 Culture Clash Evolution and Stages    151 I Perceived Differences    152 II Magnified Differences    152 III Stereotypes    153 IV Putdowns    153 Managing the Culture Clash    153 Planning Stage    153 Negotiation Stage    154 PMI Stage    154 References    156 Chapter  12  Communication    157 Introduction    157 Communications with All Stakeholders    157 Communicating with External Parties    158 Communicating with Internal Parties    160 Managing Communication    163 Methods and Channels of Communication    165 References    166 Chapter  13  Integration Approaches    167 Introduction    167 Integration and Culture Clash    167 Trade-Off Between Integration and Synergy Exploitation    168 Cultural Differences and Levels of Integration    169 M&A Performance and Integration Approaches    170 A Framework for Integration Approach Choice    172 References    174 Chapter  14  Human Capital Issues and Practices    177 The Human Factor    177 The Effects of Cultural Differences and Level of Integration on Behavior in an M&A    178 Culture Clash Effects on Behavior    178 Level of Integration Effects on Behavior    179 Nature of Contact    180 HR Issues, Implications, and Actions at M&A Stages    181 Planning Stage    182 Negotiation Stage    183 Implementation Stage    184 HR Practices    185 Training    186 References    187 Chapter  15  M&A Leadership    189 Introduction    189 Leadership Challenges During an M&A    189 The Roles and Skills of Leadership in an M&A    190 Leadership Teams    191 Leadership Skills    192 References    198 Chapter  16  Trust Formation and Change in M&A    201 Introduction    201 Trust in the M&A    201 The Nature of Trust    202 Prior Relationships    203 Negotiation Process    204 Partner Abilities and Competencies    204 Cultural Differences    204 Leadership    204 Process Dynamic and Learning    205 Communication    205 Autonomy Removal    206 Perceived Benefits    206 Consequences of the M&A and Trust    206 References    207 Index    209  

About the Author :
Yaakov Weber, Ph.D. is a professor of management at the School of Business Administration, College of Management, Rishon Lezion, Israel, and president of the strategic management consulting firm Strategy, Implementation, Results. He has practiced as a strategic management consultant for more than 25 years and has assisted executives of numerous companies in successfully managing various stages of domestic and international mergers and acquisitions, including planning, negotiation, and integration. He lectures at various universities in the United States, Western and Eastern Europe, and China, in graduate schools of business administration as well as executive programs. He has conducted numerous workshops to top executives in many countries. Dr. Weber’s studies have been published in top international academic and practitioner journals, and his papers have received more than 2,000 citations in leading journals and books. He is the winner of the 2010 Outstanding Author Contribution Award. Professor Weber is co-founder and co-president of the EuroMed Research Business Institute (www.emrbi.com), the EuroMed Academy of Business, and the EuroMed Research Centre. EMRBI performs a variety of international academic and business activities (conferences, business research, teaching, training programs, and so on) that involve businesses and consultants in, and related to, the EuroMed region.   Shlomo Y. Tarba, Ph.D. is a lecturer in Strategic Management and Global Strategic Partnerships at the Management School, The University of Sheffield, UK. He received his Ph.D. from Ben-Gurion University and master’s degree in biotechnology at the Hebrew University of Jerusalem, Israel. His research papers has been published in journals such as Academy of Management Perspectives, International Studies of Management & Organization, Thunderbird International Business Review, International Journal of Cross- Cultural Management, Human Resource Management Review, Advances in Mergers and Acquisitions, and others. Dr. Tarba has served as a guest editor for the special issues on Strategic Agility at California Management Review; Organizational Ambidexterity at Human Resource Management; Maturing Born-Global Knowledge Intensive Firms at Management International Review; Emotions, Culture, and Stress in the Interorganizational Encounters at International Business Review; and others. He was granted the 2010 Outstanding Author Contribution Award by Emerald Publishing. His consulting experience includes biotechnological and telecom companies, as well as industry associations such as The Israeli Rubber and Plastic Industry Association and The U.S.–Israel Chamber of Commerce.   Christina Öberg, Ph.D. is an associate professor at the Department of Industrial Management and Logistics, Lund University. She currently conducts research at the Centre for Innovation and Service Research, University of Exeter. She received her Ph.D. in industrial marketing from Linköping University. She has an industry background in which she held such positions as financial manager and head accountant. Her research interests include mergers and acquisitions, brands and identities, customer relationships, and innovation management. She has previously been published in journals such as Journal of Business Research, Construction Management and Economics, International Journal of Innovation Management, European Journal of Marketing, The Service Industries Journal, Journal of Business-to-Business Marketing, Scandinavian Journal of Management, Thunderbird International Business Review, and Industrial Marketing Management.