Research, Screening & Cultural Negotiation Support to Finalise a Chinese Industrial Acquisition
Profile
A global leader in specialist industrial control equipment was targeting China acquisitions as part of its international expansion plans. Without local industry insight, language ability, and on-site experience, the company was not confident in being able to accurately assess the market for suitable partners and thereafter to manage the negotiations in an expedient manner.
Requirements
Suitable targets were high technology manufacturers, ideally a minimum of 500 staff, and profitable. Furthermore, the potential targets needed to be open to Western management and to a wholly owned venture.
Process
Market Research
Salzer Consulting conducted in-depth research into the local market and emerging opportunities in the sector. This study assessed comparable M&A activities of key competitors and sectoral business risks. Sources included industry associations, expert interviews, and market data. 65 prospects were identified for the initial qualified list.
Target Selection
Salzer Consulting worked with the Client to refine their screening criteria for target companies. Of the initial qualified list, the Client (with support from Salzer Consulting) selected 14 suitable candidates.
Site Visits & Interviews
Keeping the client identity confidential, Salzer Consulting conducted site visits and further detailed research on these 14 targets. These assessments formed the basis of a high level due diligence plan that was presented to the Client’s senior management. The plan evaluated various aspects of strategic fit as well as roadblocks for consideration.
Negotiation Support
The Client and target companies committed to a Statement of Intention before commencing negotiations. This document established the negotiation process, timing and expectations to ensure efficiency in reaching a conclusion to the negotiations.
Outcome
Using the client criteria, Salzer Consulting applied extensive industry experience, on site assessments and analytical research to filter an initial qualified list to two deemed to be the most promising for negotiations.
The professional insight and effectiveness of the target screening process encouraged the client to retain Salzer Consulting to support subsequent negotiations. These negotiations were managed in accordance with Salzer Consulting’s parameters to ensure efficiency and rapid decision making.
For more information on how Salzer Consulting can help your business, please contact us.
