www.dataroomdev.blog/elon-musk-and-twitter-deal-details/
The merger and acquisition market is one of the most lucrative and dynamic opportunities in corporate finance. While it is not a strategy that every business could pursue, for those that can succeed, M&A can create tremendous growth potential. M&A transactions can be very complex and require careful planning and execution to be successful. The M&A process begins with a preliminary assessment of the company. This could involve high-level discussions between sellers and buyers to assess how the companies could be integrated strategically and what their values are aligned and what synergies may exist.
Once the initial review is completed, the acquiring firm may present a preliminarily offered offer to the target firm. This could be done by way of an outright purchase or a tender. A company may purchase all shares of a business in an outright acquisition. This is done without the company’s board of directors and management and is usually done for a premium over what the shares were worth prior to being acquired.
A tender offer permits a publicly traded company to reach out to shareholders of a privately held company and offer to purchase their shares at a cost that is agreed by both parties. This is a form of a hostile takeover and requires the approval of the shareholders of the target company before it can be finalized.
The possibility of gaining revenue and cost synergies from the merger of two companies is a primary reason for a company seeking M&A. For example when a car company purchases a manufacturer of seat belts, they can realize economies of scale and lower the cost per unit as production increases. Companies also use M&A to gain access to technologies that would be expensive or time consuming to develop internally.
