How Can a Platform Organize M&A Deals?

A platform can help in organizing M&A (mergers and acquisitions) deals by creating a digital marketplace or M&A deal sourcing platform where buyers and sellers can connect and conduct business transactions. It involves a deal pipeline.

This merger and acquisition funnel is concerned with the sequence of activities that take place throughout a transaction while involving stakeholders at each stage. The pipeline initiates with the formulation of an acquisition strategy and the identification of potential deals. It is then followed by acquisition planning, negotiation, and due diligence, culminating in the transaction and integration phases.

Because of some gaps, a study by Harvard Business Review found that the failure rate for M&A deals was even higher, at around 80%. These gaps can be filled with deal-sourcing platforms.

Let's get into various features that maximize deals.

Easy Solutions to Have M&A Deals via a Platform

Here are some steps that a platform can take to have M&A deals:

a. Marketplace/ Deal Sourcing Platform Helps

First, start with developing an online M&A deal discovery platform where both, buying and selling entities, can interact, explore the listing of various interested parties, and contact one another without any hassles. The marketplace are easy to use and have robust search and filtering capabilities. Simply put, an ideal marketplace for mergers & acquisitions have these features:

• An ideal one provides access to a wide range of deal opportunities across various industries and geographies, using different sourcing methods such as proprietary databases, broker networks, and public data sources.

• Users can easily filter and search for deals based on criteria such as deal size, industry, location, stage, and transaction type. They can also be able to save search parameters for future reference.

• The platform provides regular updates on new deals that match the user's interests or saved search criteria, as well as alerts when there are changes to deals they are tracking.

• Here, interacting with relevant data and analytics on deals, such as financial metrics, market trends, and comparable transaction data, can help users make informed investment decisions.

• The platform should enable easy collaboration and communication among deal stakeholders, such as investors, brokers, and sellers, through messaging or offline communication.

b. Having a User-friendly interface

It refers to the platform that is easy to navigate and use for both buy-side and sell-side parties.

This online places have advanced search features that can enable buyers to find suitable acquisition targets quickly. Having a SaaS-based system can help you with the same. You can access the pooled data of target companies to go through the next level of a merger funnel. Additionally, users can have these features also:

• The platform offers a wide range of companies available for sale, covering different sectors, sizes, and geographies.

• The M&A platform comes up with strong security protocols to protect sensitive information and maintain confidentiality.

• The marketplace provides transparent information about the companies listed, including their financials, market position, and potential risks. Various parties leverage this benefit.

• The platform often carries efficient communication tools, such as messaging, offline communication, to facilitate discussion.

• These marketplaces often connect with expert advisors to guide buyers and sellers through the merger and acquisition transaction process management, including legal, financial, and technical advice.

• These digital platforms offer flexibility to accommodate different deal structures and negotiate terms and conditions that work for both parties.

• Having a proven track record of successful transactions, with testimonials and case studies from satisfied clients can be there, which build trust among corporate entities.

• Data analytics and insights are the best things to look into for making informed decisions, which these kinds of platforms often provide for transactions.

c. Establish Trust and Credibility

An ideal deal platform for mergers and acquisitions helps in establishing trust and credibility with its users by implementing measures such as identity verification, transaction monitoring, and dispute resolution mechanisms. In addition, they come up with essential features like these:

• These platforms ensure the sharing of sensitive information between buyers and sellers with security and confidentiality. They often have robust security protocols, encryption standards, and data protection policies.

• As a deal requires transparent communication between the parties involved in the M&A deal, these deal discovery platforms provide clear and open channels for communication and timely alerts or notifications. They also provide regular updates on the status of the deal and offer a reliable way to resolve any disputes that may arise.

• The M&A platform is easy to use with a simple and intuitive interface. It allows users to navigate through the system with ease and minimum errors so that users can have a smooth and hassle-free experience.

d. Data Analytics for Informed Decisions

Global M&A industry trends favour the platform that has integrated data analytics and insights to help buyers and sellers make informed decisions. It provides access to relevant market data, deal history, and other relevant details that guide users to make better decisions.

e. Reputation Management

The prospective parties can have a robust reputation management system. These online platforms are integrated with strict policies to prevent fraudulent activities, such as fake bids, and also, take prompt action to address any instances of misconduct.

f. Security & Support

These digital M&A platforms are guarded by all relevant regulatory requirements, such as data protection laws, anti-money laundering regulations, and other relevant regulations.

These platforms offer support via M&A business advisors to users, such as legal, financial, and tax experts. With these professionals, navigating through the complexities of the M&A process is a cakewalk. This happening builds trust and credibility among users and provides assurance that the deal is being conducted in a professional and ethical manner.

g. Quality List and Communication

Curating the listings on these marketplaces ensure that they meet certain quality standards. This can involve verifying financial and legal documents and conducting further processing.

Communication is a must during the deal. The platform provides tools for buyers and sellers to communicate with each other offline. This can assist to streamline the negotiation process and build trust between the parties.

By taking these steps, a platform can create a digital marketplace that brings together buyers and sellers and streamlines the M&A transaction process. This can help to reduce transaction costs, increase deal flow, and provide more efficient access to capital for businesses.