What is M&A?
Merger & Acquisition (M&A) refers to transactions where ownership of companies is transferred or combined.
Types of M&A Transactions
| Type | Description |
|---|---|
| Acquisition | One company buys another |
| Merger | Two companies combine into one |
| Amalgamation | Multiple companies merge |
| Demerger | One company splits into multiple |
M&A Process (10 Steps)
Phase 1: Preparation
Step 1: Strategy Definition
- Define acquisition criteria
- Identify target sectors/geographies
- Set budget and timeline
Step 2: Target Identification
- Screen potential targets
- Initial outreach
- Preliminary discussions
Phase 2: Evaluation
Step 3: Non-Disclosure Agreement
- Exchange confidential information
- Begin detailed discussions
Step 4: Letter of Intent (LOI)
- Non-binding terms agreement
- Valuation range
- Exclusivity period
Step 5: Due Diligence
- Financial DD
- Legal DD
- Tax DD
- Commercial/Operational DD
Phase 3: Negotiation
Step 6: Valuation Final
- Post-DD valuation adjustment
- Working capital mechanism
- Earnout structure (if any)
Step 7: SPA/SHA Drafting
- Share Purchase Agreement
- Shareholders Agreement
- Definitive legal documents
Phase 4: Closing
Step 8: Regulatory Approvals
- ROC filings
- NCLT approval (for mergers)
- CCI approval (if applicable)
Step 9: Closing
- Share transfer
- Payment
- Condition precedent completion
Step 10: Post-Merger Integration
- Team integration
- Systems integration
- Culture alignment
Due Diligence Checklist
Financial:
- 3-5 years audited financials
- Tax returns and assessments
- Bank statements and loans
- Debtor/creditor aging
Legal:
- Company documents (MOA, AOA)
- Contracts and agreements
- Litigation pending
- IP ownership
Tax:
- Tax compliance history
- Pending assessments
- Transfer pricing issues
HCS M&A Advisory
HCS Business Solutions supports:
- Target identification
- Due diligence coordination
- Valuation advisory
- Transaction structuring
- Regulatory filings