Analyzing key factors affecting post acquisition performance : using ratio analysis

Abstract

When we talk about how the business can be expanded externally then the phenomenon of merger and acquisition come into place. In merger and acquisition a business of one kind may acquire the business of same kind or different kind to improve the efficiency and the productivity of the business consuming much less time. There are number of factors involved in the success and failure of acquisitions. For instance, strategic planning plays a key role because if the top management plans well about acquisition then there are high chances of success of acquisition. If the acquirer company does well the due diligence and gain maximum information about the target company then the acquirer company will certainly have minimum risk about the failure of their objective. Strong and friendly leadership has a direct relationship towards the better performance of any organization. So if the top management needs to be the acquisition successful, then they should make friendly relationship towards their staff and they should make their objectives in such a way that they has a desire to make the company successful instead of making their own position strong. Their first priority should be to make the acquisition successful so that they can achieve all their goals.