Many acquisitions fail to live up
to expectations. The reasons range from poor deal structure, poor strategic
fit, failure to identify problems with the quality of earnings, overly
optimistic estimates of synergies, to lack of an integration plan.
Evaluating a company in another
country compounds these risks. You are dealing with a different language and
cultural barriers; different business ethics, legal systems, filing
regulations, and accounting principles; transfer pricing that affects taxation
– and often government involvement.
But international deals often
provide the best growth opportunities. They can offer improved returns from
economies of scale, new target markets for existing products/services, access
to commodity materials, and a hedge against seasonality.
Even savvy managements and private
equity investors cannot know everything they should to make a deal successful,
so they need an experienced international advisor.
Please feel free to contact our
office with any questions regarding advisory services.