It doesn’t matter what type of business you own, merging with or acquiring a new company is tricky business. M&As happen across many industries, but perhaps law firm mergers are becoming one of the most popular types. There are many legalities to consider (as lawyers should be aware of) and with any merger or acquisition, there is a lot of risk involved.
Law firm acquisitions are happening all the time, as bigger companies aim to expand into new territory and take advantage of local talent. A merger can be a great idea and provide a range of opportunities for both parties, yet no company should ever rush into an acquisition deal. It is a long process, and discussions can continue for months. As with any M&A, here are the steps involved.
Define goals and objectives
Before you go into any talks, it’s important to define the business goals and objectives. What do you want to achieve? How will their merger help you achieve it? If these two questions seem disconnected then it’s a warning sign that this acquisition might not be the right decision for your company. If you’re not sure how the merger will benefit, ask these questions in your first meeting. Any acquisition should benefit both parties so it makes business sense to merge.
Hire a Broker
Other business may decide to hire a lawyer to help them through the acquisition process – but law firms have these in abundance. Instead, when requiring an expert a legal practice should turn to a law firm merger broker to assist. They can use this expertise to ensure the deal looks attractive and to negotiate with other law firms.
Obviously, any law firm will understand the importance of due diligence checks during M&As. If both law firms are happy with the proposed plans to merge, then before proceeding with signing on the dotted line you must perform due diligence. Don’t take their word for it – they might have a hidden agenda for acquiring your company.
Close the deal
If both companies are happy with the way the talks are going, and the due diligence checks were satisfactory, then it’s time to close the deal. Write up a contract and have at least two legal professionals check it over. Remember that even when the acquisition is legally complete, you will still have plenty of work to do to successfully integrate the two businesses. Put a plan and a schedule in place for the right decision makers to meet and discuss strategies.
An acquisition or merger is a complex process and shouldn’t be rushed – this is a very short introductory guide. If you need further help during the acquisition stage call in the experts.