Mergers and Acquisitions

Mergers and Acquisitions

Aristotle said, “The whole is greater than the sum of its parts.” This is the supporting principle of Mergers and Acquisitions. Two companies come together either by one acquiring the other, or two equal companies merging and going forward as one. The truth is, mergers rarely occur as one of the companies involved is dominant.

Chinook follows Artistole’s philosophy when providing Mergers and Acquisitions services. Companies become greater when they take advantage of synergistic opportunities created by combining with other companies. When companies come together they can achieve cost efficiencies in the delivery of goods and services, sales and marketing, and the administration of the business. Here are four examples synergies:

  1. Economies of scale. As it turns out, size matters. The increased purchasing power of a larger company will warrant quantity discounts on everything from office supplies to advertising. This will affect every department of a business.
  2. Redundancy in staffing. Typically, all departments are affected from sales staff, to accounting, to the executive suites. Having two COOs, CFOs, CIOs, CEOs or any other C_Os in one business is simply not workable.
  3. Expanding markets. It is cheaper to access a new geographical market by acquiring a company that serves that area in your industry than it is to try and grab a foot hold through aggressive marketing and sales. This is especially so when you need to push the incumbent suppliers in your industry out.
  4. Research and Development. Keeping a company on the front edge of technology and other areas is an expensive proposition. Acquiring the kind of proven technology required to enhance or solidify your position in a marketplace is usually less expensive.

At Chinook Mergers, Acquisitions and Business Brokerage we work to identify our client’s suitability for an M&A approach to the marketplace. In those cases, we alter our approach to maximize what the business owner might garner from the sale of their business.

To learn more about how we work with business owner, please contact us today.

To learn more about Mergers and Acquisitions, read this article from Investopedia: