SOURCE: Cutting Edge Information

Cutting Edge Information

October 05, 2010 12:04 ET

Successful M&A Integration Timelines Help Mergers Better Achieve Top-Level Goals

Standardizing Mergers and Acquisitions Practices Also Helps Life Science Companies Focus on the Best Potential Acquisitions, Says Cutting Edge Information

RESEARCH TRIANGLE PARK, NC--(Marketwire - October 5, 2010) -  Many large companies have made at least a few acquisitions for strategic portfolio purposes and some companies make monthly or even weekly announcements of such deals. Most of these organizations have standards of one time or another for their integration practices and timeframes.

For organizations with less M&A experience, running up against a difficult deadline can spell disaster to integration. Rushing to bring personnel up to speed impedes their ability to effectively perform their day-to-day functions, according to consulting firm Cutting Edge Information.

Cutting Edge Information's recent study, "Pharmaceutical Mergers and Acquisitions," found that speeding too quickly through integration often results in disorganized communication lines, unclear reporting structures, and technical disruptions. One industry executive suggested that correctly setting the timeframe needed to complete integration is a Key Practice that often determines whether an acquisition is a failure or success. The bias should always be towards doing things right rather than doing things fast.

"Extending integration timeframes provides a buffer for any unforeseen integration problems that may arise," said Jason Richardson, president of Cutting Edge Information. "With that extra time allotted, companies can greatly improve the changes that integrations will run smoothly and actually come in on schedule."

Executives interviewed for the study said they use consultants and advisors to minimize the challenges that result in missing deadlines. Using specific external expertise saves time for strategically critical M&A activities. These can include understanding the cultural differences between the organizations and increasing the two staffs' understanding of each other's product and strategic goals.

Another strategy shared by successful integration managers is the establishment of M&A teams. Companies regularly undertaking integration projects find that formal and well-experienced M&A teams help to standardize the processes, large and small, that increase the likelihood of success. These teams are primarily composed of internal staff and conduct data collection, acquisition profiles, and investor presentations.

"Standardizing these practices helps organizations focus on their potential acquisition targets and provides decision-makers with qualified options," added Richardson.

Cutting Edge Information (http://www.cuttingedgeinfo.com/) is a consulting firm serving the life science industry. For more information about business development and M&A support, contact Elio Evangelista at 919-433-0214.

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