It is no secret that the sooner companies implement post-acquisition plan, the faster they complete critical tasks, and the highest is their chance of capturing the expected synergies. Likelihood of success in M&A depends on due-diligence and post-acquisition preparation.
Post-acquisition plans require a thorough preparation and articulation of a core set of principles, overarching value-creation initiatives, strategic planning, organizational design and communication. Most importantly, a post-acquisition plan should be designed before the deal closes - even before it starts.
Although a merger, acquisition or joint-venture must be thoroughly controlled at the integration stage, the success of those operations mainly relies on the strategic choices and tactical plan that are made before the deal is closed, and often before the bid has even been made, especially in such a complex BioPharma industry.
Without strategic and tactical foundations that are well-designed and planned far in advance, post-acquisition plan cannot be executed in due-time, limiting value creation and shareholder returns, from the outset.
Yet, most BioPharma companies and Private Equity firms link post-acquisition steps to a mechanical process that occurs after the deal is done - and not before. Such an approach often leads to costly delays, unwanted brain drain, overwhelming daily routines and ultimately a high risk of failure. Too many companies simply under-deliver.
About 40% of mergers and acquisitions in the biotech & Pharma industry fail to create shareholder value. Half of it even destroys value.
Still, Mergers and Acquisitions are a unique opportunity for structural and daring changes. People minds, knowingly or subconsciously, anticipate change during post-acquisition or merger integration. A new owner will likely bring a new model. So time is perfect for bold changes, but the window closes quickly, so the action plan must be ready from day one.
Consequently, the success of a merger or an acquisition depends on the ability to implement the post-acquisition plan within the shortest timeframe - the first three months after acquisition are crucial.
For over a decade, Larka has been successfully helping its clients identify and capture the full value potential of their specific deal - merger or standalone acquisition - through structured end-to-end process and tested methodologies.
From deal sourcing through integration, Larka has specifically developed M&A operating principles and capabilities for the BioPharma industry, that focus on the issues that matter most at each stage of a transaction process and for each critical aspects of this industry - Strategic, Commercial, Technical and Organizational.
Through this integrated M&A approach, our clients benefit from compelling investment thesis that integrates competitive situations, a wide-spectrum synergies and risk assessment, and a post-acquisition plan early enough to optimize implementation and maximize deal's value creation.
We could also observe that our most successful clients invested a large amount of time, money and organizational focus on M&A plans and compelling investment thesis, in advance of any particular deal.
We've been working for years with those clients, elaborating consistent, and methodological M&A operating principles and guidelines, while building and cultivating M&A networks of potential sellers at the same time.