There is only one valid definition of success in an acquisition: the value of the merged AB must be greater than the former values of A plus B. More often than not, this is not the case. Most acquisitions fail.
This is because the buyer pays too much for the target. This may be due to managerial pride or ‘deal fever’. Or sticky implementation. Or it was the wrong target.
But too often it is down to inadequate due diligence – sometimes financial, perhaps legal, usually strategic. The buyer does insufficient research and analysis on the target’s market demand, competition, competitive position, strategic options and business prospects.
Let the Sun Shine! How Strategic Due Diligence Is Key to Acquisition Success shows the manager, the entrepreneur, the consultant, the investor or the banker the essentials of strategic due diligence. The author has unparalleled experience, having been active in this field since LBOs first wafted over the Atlantic in the mid-1980s.
The first part of the book examines strategic due diligence on a stand-alone business and is particularly pertinent for venture capital or private equity transactions. The second part looks at how strategic due diligence is applied in synergy assessment, the key ingredient in ensuring success from a corporate acquisition, alliance or divestment.
Follow the book's guidelines and you’ll improve your chances of success in your acquisition, MBO, merger, alliance or strategic investment.
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“I’ve seen more acquisition disasters from unidentified external trends than from internal failings. The reason: far too often acquisition due diligence focuses on the minutiae of the business, rather than on the larger strategic issues which it faces. This book seeks to rectify that by giving detailed practical advice about how to do strategic due diligence. I recommend it to everyone involved in acquisitions.”
Adrian Beecroft, Chairman of Dawn Capital and former Chief Investment Officer of Apax Partners LLP
“An insightful – and user friendly – guide to the key component of a successful corporate acquisition.”
Mike Garland, Partner and Head of Portfolio Group, Permira Advisers LLP
“This is a thoughtful and incisive guide to strategic due diligence, encapsulating 30 years of the author's experience of working with companies and investors. It is also a highly enjoyable read, including many insightful case studies from a range of industries. I particularly enjoyed the central case study of Breakout Ltd. The book provides an invaluable roadmap for decision-makers, advisers and investors.”
Charles Ind, Managing Partner, Bowmark Capital LLP
“There are many contributors to acquisition success, but one of the most important is the necessity – indeed the imperative – to conduct effective and efficient strategic due diligence. Vaughan Evans shares his decades of experience in leading due diligence teams, providing real examples as well as effective tools to enable acquirers to improve their own understanding of this critical area. If only everyone followed his advice, the overall success of these deals would certainly be improved!”
Professor Scott Moeller, Director, M&A Research Centre, Cass Business School, City University
"Vaughan Evans pours sunlight onto the complex challenges of getting strategic due diligence right. Caveat emptor unbundled!"
James Courtenay, Head of Global Corporates, Standard Chartered Bank
“Strategic due diligence is the most frequent cause of failure if not done properly. This important book will help you get it right.”
Jose Maria Maldonado, Partner, Bridgepoint Development Capital
"As someone who has completed acquisitions of all sizes in about every corner of the world, I understand how straightforward it is to do the deal and yet how difficult it is to do the right deal. Proper strategic due diligence is the differentiator between creating and destroying shareholder value. Vaughan Evans’s book is an invaluable guide to getting it right. It is an enjoyable read with super materials."
Jeff van der Eems, Chief Executive Officer, United Biscuits Ltd.
“Strategic due diligence is the sine qua non of any investment. Vaughan Evans demonstrably has enormous experience in this field. I particularly like his Suns & Clouds chart, which sums up well the final decision on risk and opportunity the investor must make. This is an easy-to-read, spirited and invaluable guide to the discipline.”
James Pitt, Partner, Lexington Advisers UK Ltd
“A step-by-step guide and illustration to successful deal making.”
Huainan Zhao, Professor of Corporate Finance, School of Management, Cranfield University
“Vaughan Evans has produced yet another great resource for business owners, managers and acquirers. Strategic due diligence is a core and absolutely key input into our investment decision making process and this book provides an excellent overview of the key strategic elements that are so important to an acquisition’s success.”
Paul Gough, Partner, Star Capital Partners
“So many acquisitions fail to create shareholder value not because they weren’t a good idea but because the buyer paid too much. Rigorous strategic due diligence, as set out admirably in this book, should enable good deals to get done.”
Christine Harvey, former Director of Business Analysis and Planning, GlaxoSmithKline R&D
“Vaughan Evans has been there from the very start, when bankers funding new-fangled buyouts thought ‘market studies’ might be a good idea. These pearls of wisdom on strategic due diligence, rooted in four decades of experience, will greatly improve the buyer’s chances of success in any investment or acquisition.”
Jonathan Derry-Evans, Partner, Manfield Partners
“I am glad to see that Vaughan has remembered everything I taught him! On a serious note, this book is the first and last word on how to carry out commercial due diligence – and why. It will be an invaluable aid to successful deal-making. ”
Stephen Lawrence, CEO Protocol Education and former Managing Director, Arthur D. Little Ltd
“This is the clearest exposition that I’ve yet seen of why rigorous strategic analysis is the single most important determinant of acquisition success. The step-by-step guide to carrying it out, and clear real-life examples of its impact, make it a must-read for anyone involved in M&A.”
Richard Kemp, Managing Partner, Sephton Capital
“The success of an acquisition is critically dependent on thorough due diligence. Whether you are an acquirer, a vendor, an investor, an advisor or an entrepreneur, this book is an essential guide to the steps required to make a thorough assessment and balanced judgement of the strategic logic underpinning your transaction. Vaughan Evans has once again come up with a must have guide to the relatively young, but absolutely essential, discipline of strategic due diligence.”
Vince O’Brien, Director, Montagu Private Equity and former Chairman, British Venture Capital Association
“Over the years I have seen many commercial due diligence reports carried out by the author. They have been exemplary – and in this book he shares the how-to, the tips and the secrets of CDD with all. Read, enact and enjoy more fruitful acquisitions.”
David Williamson, Managing Partner, Nova Capital Management