Business Acquisitions: Preparing the Decision Basis

Business Acquisitions: Preparing the Decision Basis

In any acquisition, it is critical that management, the board, and owners have access to a clear and well-structured decision basis. By preparing and presenting a detailed business case, market analysis, integration plan, and recommendation, the decision-makers gain the information they need to evaluate risks and opportunities. A strong decision basis ensures that all aspects of the deal have been analyzed and that there is a concrete plan for successful execution and integration.

What should a decision basis include?

Summary of due diligence findings
Highlight the key takeaways from due diligence, including commercial, financial, legal, and operational risks and opportunities. This gives decision-makers a clear picture of the target’s strengths and weaknesses.

Risks and opportunities
Provide a structured overview of the risks and opportunities identified. These may include financial risks, regulatory challenges, operational improvements, or growth potential. A clear risk–opportunity analysis helps ensure fully informed decisions.

Strategic rationale for the acquisition
Explain why the acquisition makes sense and how it supports the company’s long-term strategy. Examples include market or geographic expansion, access to new technologies, diversification of products and services, or strengthening competitive position.

Market analysis
Deliver a detailed assessment of the market, including size, growth potential, competitive landscape, and key industry trends. This analysis helps clarify how the target is positioned today and how future developments may affect performance.

Financial analysis, budgets, and forecasts
Present a thorough review of the target’s financial position and outline how the acquisition will affect the acquirer’s balance sheet and cash flow. Include purchase price, financing structure, and potential risks. Provide budgets and forecasts with scenario analyses to illustrate different outcomes.

Synergies and cost savings
Identify potential synergies and describe how they will be realized. Quantify the expected impact on profitability and outline the steps needed to capture these benefits.

Integration plan
Provide a detailed integration plan covering organizational changes, IT systems, corporate culture, and HR considerations. A robust plan reduces disruption and accelerates realization of synergies.

Risk analysis
Summarize the main risks associated with the deal — market, operational, financial, and legal — and describe how these risks will be managed. Proactive risk management increases the likelihood of success.

Recommendation to the board
Conclude with a clear recommendation, summarizing the key arguments for and against the transaction. This gives the board and owners a strong foundation for making an informed decision.

Conclusion

A well-prepared decision basis ensures that management, the board, and owners can evaluate an acquisition from all relevant angles — from due diligence and market potential to financial impact and integration planning. By presenting a structured and transparent analysis, the company increases its chances of making sound decisions and executing a successful transaction.

At FLB Partners, we support clients throughout the entire acquisition process — from strategic planning to integration. Contact us today to learn how we can help your company build a solid decision basis for its next acquisition.