The global mergers and acquisitions (M&A) activity fluctuated significantly over the past two decades in terms of the value of global M&A deals and the number of deals completed.

Mergers, acquisitions, internal reconstructions/reorganizations, hive-off, etc. are being taken up by companies which are seeking growth, efficiencies, synergies, business focus, wealth maximation in both domestic and international markets.

Why are M&A services crucial for businesses?

Successful businesses often think about acquiring another company or merging with a competitor in the same sector. Increasing profits by extending your market and lowering competition is the common driving force behind businesses engaging in mergers and acquisitions. Corporations may also merge in order to buy distinctive assets, break into undeveloped markets, or develop a synergy that increases the worth of the two or more merging businesses. M&A offer advantages and disadvantages that are unique from other corporate deals. Here are some more reasons for which organizations shall consider undertaking M&A:

Economies of Scale

One of the important end goals of an M&A activity is to achieve economic gains and economies of scale. This becomes feasible/ possible as the firms involved in the deal are stronger together than apart. The consolidated businesses reap benefits like:

• Improved access to capital
• Better bargaining power in the marketplace
• Service to a wider customer base across geographical locations
• Lower costs resulting from high volume production and more.

Competitive Approach in the Marketplace

Synergies are usually defined as ‘4+4= 10,’ i.e., the profit from two companies working together makes something more powerful than their performances. M & A services offer Corporate Finance Consulting, which helps organizations understand their potential financial strength if the M&A activity sails through. Having greater financial strength can lead to a higher marketplace segment, more customer control, and decreased competitive threats.

Talent acquisition

Indeed, every firm needs talented employees, and when it comes to talent acquisition, it is one of the major concerns for corporations that wish to stand out in the market. The bigger the business, the better access to the best available talent. This trend is distinct across industries, from manufacturing to technology and services. Therefore, one of the key considerations at the time of undertaking a restructuring activity is the retention of the old workforce and integrating them into the new structure, which helps the organization obtain a skilled and talented workforce.

Access to Resources adds Diversification through Portfolio

Businesses in a similar sphere can sometimes enhance procurement access to raw materials, suppliers, and tangible & intangible resources.

Expanding services into a new market can be difficult, even for well-established businesses. While setting up a branch is always a choice, it saves significant time, effort, and money compared to starting from scratch.

This is particularly right for businesses ready to move into an overseas market. Therefore, it is more practical for most companies to unite with an established local business having its legacy business and domain expertise with a dedicated customer base.

Enterprise Continuation

Often small businesses are privately owned. Once the founder step downs, business failure is possible because there may not be a strong succession strategy. This can put the organization out of work and affect the stakeholders of the business. M & A strategies help ensure business stability and succession, decrease operation interruptions, protect the stakeholders’ interests, and offer job security for employees.

Why SBC?

A sizable portion of M&A activities fall short of expectations in terms of advantages. In order to provide the desired results, integration of any mergers, acquisitions, internal reconstructions/reorganizations, hive-off, etc., should be carefully planned and carried out. After the sale closes, the hard work begins.

Reduced Risk: we provide end-to-end assistance in dealing with restructuring activities which namely involve pre-acquisition due diligence, ideating & conceptualizing restructuring activities, implementation assistance and post-closure compliances/ assistance.

Experience dealing with Indian businesses: Since more than 90% of Indian businesses are family-owned, we are aware of the value of building a long-term relationship with them and serving as their confidant.

Experience: We have decades of expertise in assisting various business groups (domestic and international) in undertaking numerous transactions/ restructuring activities from both the target/ vendor perspective as well as from the buyer perspective.

Our Services

Our professionals have a wide range of expertise in establishing integration governance, putting in place the structures necessary for effective integration, and collaborating closely with your teams to precisely define every aspect of the goal and carry out the plan smoothly. We provide M&A services to clients throughout the transaction’s lifecycle; from acquiring a company to structuring the transaction, from tax advisory to due diligence, from kick-starting the transaction to getting approvals from regulatory bodies and operate seamlessly across various functions within SBC to offer a complete suite of M&A solutions to our clients.

We will simultaneously ensure that you get the anticipated advantages and maximize the value of your M&A deal.

CORPORATE RESTRUCTURING

• We assist in identifying alternate corporate restructuring options that may be available after M&A, critically evaluate the same from each stakeholder’s perspective and identify potential tax costs associated with it, suggest suitable options for cash and tax rationalization, evaluate regulatory hurdles if any, and help appropriate decision making.

FINANCIAL STRUCTURING

• Extensive analysis of each transaction, enabling conceptualization, selection, and implementation of options from a tax and regulatory perspective, is provided during the process of undertaking M&A. In addition, advice on profit extraction/ cash repatriation techniques is also provided from a tax and regulatory efficient manner.

ACQUISITION STRUCTURING

• Advice on domestic and inbound/ outbound acquisition structuring for strategic acquirers – directly or through appropriate intermediary jurisdictions, tax treaty network of intermediary jurisdiction, taxation on current acquisition & future divestment or exit, and capital market implications. In addition, we assist in structuring acquisitions, either by way of asset/ business purchase or share purchase, from a tax and regulatory perspective.

TRANSACTION ASSISTANCE

• We provide in-depth advice on the transaction structure from an overall tax & cost optimization perspective in case of an acquisition of an existing business (share deal Vs Asset deal), undertake drafting/ reviewing contracts with local joint venture partners, provide due diligence support, assist in setting up of entities for international groups. Further, we also help foreign companies fine-tune their investment strategies while making inbound investments.

POST DEAL SUPPORT

• We extend post-deal support such as drafting necessary documentation, management of condition precedents, necessary Regulatory approvals, project management of closure activities, compliance with FEMA, Companies Act and other applicable regulations, liaising with regulators and filing of necessary forms/ letters/ intimations. We even assist in post-deal integration activities such as identifying the various licenses and registrations, government sanctions, awards, etc., that need to be altered, or taken afresh, review customer contracts, vendor contracts and other business contracts. Further, a structured approach is provided by working with the key stakeholders in the client’s team. Substantial time is spent on the planning, sequencing, and timing of every action to ensure there is no business disruption. Subsequently, our experienced team manages and implements the said framework.