The most important reason to opt for a strategic business acquisition is to create value. Strategic acquisition is a way for a company to grow in different areas. There are three types of strategic acquisitions, based on different ambitions and interests of the buying and selling parties.
Strategic acquisition of a competitor
In order to reinforce their own market position, it can be interesting for entrepreneurs to acquire a competing company. The advantages include expanding the customer network, purchasing new services or products or price advantages due to a larger purchase volume. However, strategic acquisitions depend on the willingness of competitors to actually sell.
Strategic acquisition in a different sector
A smart way to tap into a new market is a strategic acquisition of a company in the desired sector. The purchasing company is thus assured of an expansion of the customer base, an increase in turnover and an increase of its market share. This type of strategic acquisition does not lead to integration of the purchased company into the acquiring company, because the buyer usually has too little market knowledge.
Strategic acquisition by means of vertical integration
The make-or-buy issue is central in the decision of an entrepreneur to expand into the chain. Vertical integration occurs when an entrepreneur acquires a supplier. Such an acquisition can further strengthen a company’s competitive position by reinforcing its market position. Especially when the two parties have been cooperating closely before, a win-win situation for both will be the result. It is all about achieving synergy benefits, better pricing, higher margins, joint investment in new products or services and possibly operational integration.
Benefits of strategic business acquisitions
A company that wants to grow is often better off making a strategic acquisition of another company than investing in new knowledge, services or products itself. With such an acquisition, the buyer is guaranteed overall growth and a better market position. It provides access to new markets, expansion of the customer base, increase in profitability and knowledge, but often also provides new equipment and technologies.
Your partner for a strategic business acquisition
There is a great deal of interest in strategic acquisitions, reflected in the many transactions we have handled at Marktlink. Because our offices are located throughout the Netherlands and Europe, we have extensive local market knowledge. If you choose to let us guide your strategic acquisition process, we will work as a team. We will help you determine the right course that will ultimately lead to your personal objective.
Marktlink will help you to move forward
Are you considering a strategic acquisition? You have come to the right place. We work with a fixed fee, so you will know exactly what the costs will be and will not receive any unexpected invoices. As we also spend a lot of time mapping the market, we always present parties that you may not have had your eye on yet. By personally approaching these companies and asking if they are interested in a possible sale, we make sure there are no other buyers to compete with. Not only does that favourably affect the acquisition price, getting more time to get to know the company better is a great advantage as well.
Are you curious what Marktlink can do for you? Please feel free to contact us without any obligations.
