Growth and exposure to more diverse markets through international expansion is a key boardroom agenda item. Here are five considerations for CEOs taking the lead on international growth.
1 M&A: a faster growth strategy
International mergers and acquisitions (M&A) can be a quicker and potentially lower risk route than organic growth. This is because you can develop a position of scale more rapidly through existing management skills, an established market position and clients. Starting from scratch in an overseas market means having to find management and infrastructure.
2 Take time to find the right acquisition
To find an attractive business for international acquisition – one that fits your risk characteristics and adds value – you’ll have to put in the effort, be clear what you are looking for and develop an assessment framework.
3 Choose your deal finance
What extra value might a private equity investor bring besides money? More PE-backed businesses mean more liquidity in public markets and an IPO is another consideration. But make sure you understand tax, legislation and regulations in the new markets you are buying into.
4 Put people first for M&A success
After any acquisition, you need to help employees at the acquired company settle into the buyer’s culture, so they are properly translated to the local market. This might mean shipping out talent from your domestic market.
5 Have an M&A integration plan
I’d suggest a 100-day implementation plan, looking at key integration risks and how you are going to define success and put in place new growth strategies.
For advice on how we can help your business expand overseas through acquisition, contact Andy Morgan, Head of M&A.