Mergers and Acquisitions - Motives, Success factors, Due diligence & the Integration phase : A qualitative study concucted on three listed Swedish companies

Sammanfattning: Background: In year 2021 M&A deals accounted for 5.1 trillion US dollars which crushed the last record of 4.1 trillion US dollars. The strategy of creating shareholder value by acquiring, merging or through other restructuring activities is accelerating at an increasing pace. An already extensive research within M&A are supplemented by the day. Still, existing research has difficulty explaining in-depth why M&A deals tend to fail.   Purpose: The aim this thesis is to form an in-depth understanding of the M&A process with investigations and comparisons of motives for and success factors of mergers and acquisitions. The objective is also to describe the due diligence process and its impact on the integration phase with the ambition to provide additional aspects and differentiating explanations from the ones already established.   Method: By highlighting theorists view on motives, success factors, due diligence and importance of an integration strategy within M&A the question occurs, how does some of the companies active within M&A reason in this subject? The reasoning has been studied empirically through interviews with three respondents with significant positions at three different companies listed at the Swedish stock market and active within M&A. To contribute to an in-depth understanding of our research aim interviews were held to create discussions beyond only answering our research questions.   Empirical results and analysis: The empirical result received from our interviews has been compiled to present the thoughts and the discussions with our respondents. The analysis partly discusses the similarities and differences between the theorists and our respondents. Further the analysis wants to contribute to in-depth understanding of the company’s thoughts and opinions within our research aim.     Conclusion: The study indicates a variation of motives of acquiring another company. The empirical findings and the theoretical framework suggest a wider product range, personal benefits for managers, increased market power and improved economic performance as the most prominent motives. Asking theorists and our respondents of what different motives there are of acquiring other companies may consequently result in different responses. A significant factor determining whether a transaction has been successful or not are accomplishments of the financial objectives. The empirical results also indicate that synergy effects and integration goals could be considered relevant success factors as well. Theorists claim that the success factors vary greatly depending on who is being asked but agrees with the empirical findings of a repetitive success factor when asking a manager being increased revenue and profitability. Due diligence conducted by the acquirer prior to an acquisition also varies greatly depending on the reason for acquiring and the extent of the target company. However, the empirical investigation exhibits three aspects always being included which is an assessment of accounting, financial and legal aspects. Issues concerning the integration phase is incorporated in only one of the three studied company’s due diligence processes. This company allocates a separate team executing both the due diligence and the post- acquisition integration of the targeted company. Considering integrational aspects in the due diligence phase entails assessments of hiring conditions, IT infrastructure and financial reporting. The empirical findings are fragmented concerning considerations of integration already in the due diligence phase but is unanimous that a smooth integration is of utmost importance for the success of the transaction.