A Better Approach
Most M&A is like gambling
Many organizations attempting M&As are statistically more likely to reduce their Enterprise Value. 83% of M&A activity does not boost Shareholder value .... only 17 percent produced a “WIN”.
And yes ... only 17 percent of casino gamblers are winners.
More M&A Deals
Management, Shareholders and Professional Advisory firms know that to snowball, you need to be able to acquire other enterprises. It would seem this attitude has been translated into ever-increasing M&A deals.
But just increasing the deal flow has not improved the odds or likely outcomes.
A New Approach
Organic growth is less risky as it builds on the existing knowledge base, core competencies and can be funded using internal resources while growing at a slower rate rather than rapid growth via M&A. The business can adapt and develop the teams and systems needed to manage the brand, market, product, distribution and culture of the company.