Small & Mid Level Companies Account for 97% of all M&A Deals

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Mergers and acquisitions are usually thought of as being big deals done between corporate giants or companies that are dominating the industry in their respective fields. However, statistics suggest that mergers and acquisitions between small and mid level companies account for 97% of all M & A deals.

Recent mergers and acquisition deals have painted the wrong perception amongst people, that only Fortune 500 companies use these deals to establish a stronghold in the market and cut losses. That is not the case, as over time, many of these corporate heavy weights have used merger and acquisition deals to help grow their business when they were smaller in size and structure.

It is important to understand that a merger and acquisition deal does not mean taking over or acquiring a 100% stake in another company. Many small businesses acquire only part of a company in order to grow rapidly and cut their losses effectively.

Many merger and acquisition deals fall through due to the financial and legal aspects of mergers and acquisitions. There have been many examples in recent history when small companies have acquired a small portion of a major corporation, which has enabled them to get rights to a brand, service or product of that company. This will also facilitate the customers of the company, since they will be able to utilize the full range of services which the larger company offers as well.

Businesses nowadays are using mergers and acquisitions to expand their products, services and brands to different countries. Not only does it help in reducing their costs, but also exposes them to a whole new market, allowing for rapid expansion and internal growth of the company.

When you are deciding to use merger and acquisition deals to get a competitive advantage over your rivals, it is advised to have a proper structure and strategy in place, so that you do not have to face any legal issues later on. A merger and acquisition does not guarantee success, since nothing is set in stone, and with the economy at its most fragile state, it is important to have an outlined vision of the direction you want your company to take.

With competition in every industry touching new heights, mergers and acquisitions, play a significant role in helping small companies grow their business while also surviving in the industry as well.


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