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As per Harvard Business Review Articles, The Big Idea: The New M&A Playbook and M&A: The...

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Economics

As per Harvard Business Review Articles, The BigIdea: The New M&A Playbook and M&A: The One Thing You Needto Get Right, - “M&A is a mug’s game: Typically 70% - 90% ofacquisitions are abysmal failures”. You have been tasked by theBoard of Directors of Commerce Bank (Regional Bank located in NJ,NY, PA) to explore expansion opportunities in Florida via anacquisition. Commerce’s mission is to be America’s Most ConvenientBank. The CEO of Commerce has already found a target Bank inFlorida, about ½ the size of Commerce, as a candidate foracquisition and wants to proceed.

The Board is asking you to lead the Due Diligence Teamto answer the following questions knowing that 70% to 90% ofacquisitions do not meet their intended goals.


What are we acquiring?


Will this acquisition boost currentperformance?


Will this acquisition lower or increasecosts?


What is the right price to pay?


How would you avoid integration mistakes?


What other qualitative and quantitative informationwould you need to make your recommendation?


How would you present this information to theBoard?


Answer & Explanation Solved by verified expert
4.0 Ratings (704 Votes)
We are acquiring half sized bank directly in competition in Florida segment with sizeable market capitalization Acquisition will lead to cost synergies and redundant units and branches will get shut overalap of manpower and reosurces will get minimised and additional capital    See Answer
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