Mergers and acquisitions (M&A) are the process by which a company seeks to grow through either combining with another company or purchasing the company outright. The business world today is far from stagnant, with large companies often seeking greater efficiency, cost savings or markets for their products by merging with other companies.
M&A specialists are professionals trained in facilitating this process for companies. A diverse field with many responsibilities depending on the progress of a deal, M&A can be a rewarding opportunity for qualified candidates.
Standard Job Description:
The job of a mergers and acquisitions specialist is to facilitate the purchase or consolidation of companies from inception to the final merger. A merger is a complicated process, and the responsibilities of M&A specialists vary depending on the stage of a transaction. For this reason,
potential M&A specialists must be highly flexible in handling a wide range of duties as needs arise.
Before any merger can take place, an M&A specialist mus research potential acquisitions to find those that are relevant and financially beneficial. At this stage, an M&A specialist communicates directly with management personnel of other companies to identify the benefits of a deal and illustrate the terms of a proposed agreement. Companies that don’t fit the requirements are filtered out at this stage.
With a communication link established between interested parties, the M&A specialist engages in due diligence. This is a financial analysis of all data relevant to the potential merger, including a risk assessment of the target company’s current management and operational structure. This audit is designed to provide the M&A specialist’s employers with as much data as possible on the financial benefits, and potential pitfalls, of the impending acquisition.
The next stage is the structuring of the deal itself, including negotiation of an equitable agreement, employee contracts, financing and future liabilities. M&A specialists are also responsible for assigning value to target companies based on asset worth and the comparable worth of
The final stage is integration of the target company after the merger itself has been executed. At this stage, M&A specialists are responsible for carrying out management’s plan for integration as quickly and smoothly as possible so that the financial rewards of acquisition can begin to
Key Job Responsibilities:
1. Support the company’s growth strategy through identification, cultivation, assessment and execution of potential mergers, acquisitions, investments, divestitures and joint ventures.
2. Conduct analysis of prospective target companies’ businesses to determine fit and alignment.
3. Lead the negotiations, deal structuring, diligence and integration management of all corporate development activities.
4. Prepare business proposals for the executive team to evaluate M&A opportunities.
5. Work collaboratively with business units and departments in order to execute on deal goals.
6. Lead cross-functional core deal teams through the evaluation and execution of deals.
7. Develop and maintain complex financial valuation models, financial assumptions and strong underlying business case.
8. Collaborate with business teams to synthesize industry/category dynamics and all aspects of the business case development (strategic rationale, financial analyses) and support execution (e.g., due diligence, approvals process).
1. Exceptional analytical thinking and modeling skills, including DCF, comparable company, trading comparable, LBO analyses, and the ability to apply.
2. In-depth experience modeling acquisitions, divestitures, spin/split-offs, joint ventures, strategic analysis, buy vs. build, accretion/dilution, scenarios/sensitivities, synergy analyses.
3. Directly involved with the execution of strategic alliances including, but not limited to, mergers, acquisitions, divestitures, joint ventures and minority positions.
4. Candidates should be able to balance a bias for leadership roles with an equal ability to work collaboratively within teams.
5. Candidates should demonstrate leadership experience and an interest in M&A and general interest in Corporate Finance.
A bachelor’s degree in a field such as accounting, business or finance. A master’s degree will be an advantage.
1. Chartered Financial Analyst (CFA)
2. Certified Public Accountant (CPA)
Manager-M&A, Corporate Planning, Strategy Manager, Strategy Management, Supply Chain Management, Operations, Maintenance, Project
Management, Stakeholder Management, Industrial Automation, Merger & Acquisition, Due Diligence, Bid Evaluation, Vendor Management, Instrumentation & Control, Data Analysis, Advisory, Consulting, FP&A, Negotiations, Deal execution, Business Valuation, Strategy, Financial Modelling, M&A, Investment banking, Pitch Books, Corporate Finance.
1. Acquisition Analyst
2. Senior Acquisition Specialist
3. Corporate Development Executive/ Director
4. Mergers and Acquisition Manager
5. Senior Acquisition Manager
6. Acquisition Consultant
7. Asset Management Consultant
Screening Questions/Assessment Parameters:
2. Previous work experience
3. Types of clients handled
4. Average Turnover of the deal
5. Financial Modelling on Excel
1. Accretion. An improvement in per-share metrics post-transaction (after issuing additional shares).
2. Acquirer. The firm which is purchasing a company in the acquisition (the buyer).
3. Acquisition. The purchase of the controlling interest or ownership of another company.
4. Amalgamation/Consolidation. The joining of one or more companies into a new entity. None of the combining companies remains; a completely new legal entity is formed.
5. Angel investor. A wealthy individual (accredited investor) who provides seed or early-stage financing from his or her own funds in return for equity.
6. Backward integration. A company acquires a target that produces the raw material or the ancillaries which are used by the acquirer. It intends to ensure an uninterrupted supply of high-quality raw materials at the fair price.
7. Bottom line. The net income “line” of the income statement.
8. Business cycle. A recurring pattern of expansion and contraction in the economy. The average cycle is three to four years.
9. Capital expenditure (CAPEX). A large expenditure which acquires a new capital asset or improves the useful life of an existing capital asset. The cost is spread/expensed over the useful life of the asset.
10. Capital structure. The composition of the invested capital of a business enterprise; the mix of debt and equity financing.
1. Asset deal. The acquirer purchases only the assets of the target company (not its shares).
2. Bootstrapping. Generally used with startup companies, meaning the financing of business efforts with personal, existing and often scarce resources.
3. Capital asset pricing model. An element of modern portfolio theory. A mathematical model showing an “appropriate” price, based on relative risk combined with the return on risk-free assets.
4. Covenants. Provisions in the legal agreements on loans, bonds, or lines of credit. Usually written by the lender to protect its position as a creditor of the borrowers.
5. Dilution. A worsening of per-share metrics post-transaction (after issuing additional shares).
6. Horizontal integration. Merging of companies in the same lines of business, usually to achieve synergies.
7. Intrinsic value. The estimated value of the business using discounted cash flow analysis (often on a per-share basis).
8. Net book value of assets. Book value of assets minus book value of liabilities.
9. Pari passu. A Latin term referring to the equal treatment of two or more parties in an agreement. For example, an investor may want to have a certain right that is pari passu with investors in a previous financing round.
10. Pro forma shares outstanding. The number of shares outstanding after the transaction has closed and additional equity has been issued.