Chapter 4 - Planning: Developing Business and Acquisition Plans: Phases 1 and 2 of the Acquisition Process

Abstract

This chapter focuses on the first two phases of the acquisition process. Developing the business and acquisition plans are termed as the first two phases of acquisition process. Some companies view mergers and acquisitions as a business growth strategy. While firms may accelerate overall growth in the short run through acquisition, the higher growth rate often is not sustainable without a business plan, which serves as a road map for identifying additional acquisitions to fuel future growth. A planning-based acquisition process is comprised of both a business plan and a merger/acquisition plan, which together drive all subsequent phases of the acquisition process. This chapter elaborates the key activities required to be performed for developing business and acquisition plans. The chapter also examines the tools commonly used to evaluate, display, and communicate information to key constituencies both inside and outside of the corporation. The planning concepts described in the chapter are prescriptive in nature, and recommend certain strategies based on the results generated by applying specific tools and answering checklists of relevant questions.