Entrepreneurs are always looking for a way to expand the organization’s present market operations. They believe taking such step can give them the competitive edge over their rivals. One way to achieve this goal is entering into merger agreements with other similar concerns. There are a number of important reasons why they resort to this course of action. It gives these businessmen access to more money and credit. Moreover, they exploit the latest technology to improve their existing product-lines or create new ones. This helps to enlarge their current customer base.
Larry Polhill – What entrepreneurs need to consider when entering merger agreements?
Larry Polhill is a popular business consultant in America with over 30 years of valuable experience. He specializes in fields such as corporate finance, mergers, real estate management, and business acquisitions. In people in the business community of this country say he is a chief architect before the growth of many mid-size companies. These include Capital Foods, LLC, American Pacific Financial Corp., Cafe Valley, Inc and Inventure Foods, Inc. He has the distinction of holding important posts in such organizations during his illustrious career. These are CEO, President, Director, and Chairman of the Board.
In the view of this business expert, entering into merger agreements can be advantageous to entrepreneurs. However, they need to do their homework. Otherwise, there is always a possibility they’ll losing out on such deals. It is the last thing these businessmen want. This is why they need to keep in mind the following 3 important factors:
- Setting out clear objectives
Entrepreneurs need to have a clear idea of what they want out of the merger deal. They may want to sell their existing businesses or acquire similar concerns. In the case of the latter, it may be to gain access to the establishment’s key contacts. In such a case, they need to retain important personnel and managers after finalizing the agreement. However, if these proprietors want to boost productivity, they need to focus on implementing cost-cutting measures. Only then can they witness a proportionate increase in bottom-line profits.
- Ensure business cultures combine
Most entrepreneurs understand all businesses have their own way of conducting their activities. People who join such organizations gradually learn about such working culture while discharging their responsibilities. These businessmen may have their own style of operating their concerns. The establishments with which they are entering into a merger with also have their own distinct way. They need to ensure both the business cultures can intermingle without any hindrance.
- Seek necessary assistance
Business merger agreements are generally very complex. It is not possible for entrepreneurs to handle each and every aspect. The last thing they want is to make critical mistakes. This is the reason why they should hesitate to seek the assistance of reliable experts. Such professionals should specialize in important fields like accounting, corporate finance, and law. Only they can come up with a suitable purchase consideration acceptable to both parties. This is an important fact which they cannot afford to overlook.
According to popular business consultant Larry Polhill, business merger contracts are generally time-consuming and very expensive. However, businessmen need to know it is worth the wait. They obviously want to get a good deal and avoid potential problems. This is why they need to keep in mind the above 3 important factors.