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Merger of Equals
In
today’s marketplace, it is not uncommon for two firms of similar
size and business synergies to look at an avenue to combine both entities
for the good of the firms and their clients. A Merger of Equals strategy
can offer a way of achieving a corporate development objective other
than a traditional acquisition or divestiture. However, the challenges
in establishing such a strategy are frequently underestimated, causing
a substantial number of such initiatives to fail at significant financial
and opportunity cost. The key to a successful Merger of Equals is
having a clear strategic rationale, strong relationships and tightly
defined terms that address not only typical economic points but also
the alliance’s decision-making process, its conflict resolution
mechanism, the right of either party to access information, and the
right method of exit.
Gladstone provides the expertise and experience in dealing with the many forms of mergers. We identify an appropriate partner for our client, if one has not been pre-identified, and negotiate the ideal structure and terms of the merger in an orchestrated, confidential manner to create a collaborative environment. As negotiations involving sensitive intellectual property are often difficult, Gladstone plays a vital role as intermediary, helping preserve the relationship among principals whose continued trust and communication will be essential to the success of the combined firms going forward.
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