Expert opinion

How to initiate a merger opportunity

Myles Hamilton, Director and M&A specialist at Shaw & Co, shares a top tip for initiating a merger opportunity with another business.

1 minute
May 25, 2022
Myles Hamilton
Tim Gander Photography

How to initiate a merger opportunity

There are several strategic reasons why companies might seek to merge with another business. Mergers can be the ideal way to solidify and greatly enhance a company’s position and offering in its chosen sector, while considerably reducing overheads through economies of scale. In short, the value of the new combined businesses should be significantly more than the sum of its parts.

Before approaching a business with which you may wish to merge, it is important to set out the strategy and benefits from their point of view. This should cover key questions such as the revenue and cost synergies available to the enlarged business and therefore it’s increased valuation, the management of the enlarged business, the merger ratio, and the exit strategy.

Myles Hamilton - M&A expert

This preparation is key and making such assessments is critical. This is where a good corporate finance advisor will have a pivotal role to play, not only in helping to analyse potential merger targets, but also in taking a neutral role in making an approach to a business that may well be a competitor of yours while also convincing the target that your plans are serious.

We work with UK SMEs and small-cap PLCs that have the ambition to grow their business by acquisition. We often act as an outsourced Corporate Development team helping clients meet their strategic goals through mergers and acquisitions. Our value lies in helping clients build rigour into the acquisition search and execution process. For a confidential, independent, no obligation discussion on how to merge with another business, click the 'Let's chat' button.
Myles Hamilton
Myles Hamilton
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