Buying a Business in the USA
Post-Acquisition Considerations for Foreign Acquirers of US Companies
Before you close the deal on the purchase of a United States company, you need a post-acquisition plan -- a strategy that outlines how your company will handle all of the details that accompany the foreign acquisition of a U.S, business.
A post-acquisition plan is a detailed strategy that discusses how the buyer will handle the issues associated with the purchase of a new company.
Although post-acquisition plans are important in all ownership transitions, they are especially important in scenarios that involve the foreign acquisition of U.S. companies.
As an international business owner, the stakes are high and it is critical to quickly get your American business on solid ground. A good post-acquisition plan does that by addressing issues that concern stakeholders within the company as well as the buying public. Since each business acquisition is unique, the contents of post-acquisition plans vary considerably. However, if you are a foreign acquirer of a U.S. company, there are a handful of items your post-acquisition plan has to address.
Management Transition After Acquisition. One of the first issues your post-acquisition plan should address is the management transition. As the buyer, the ball is completely in your court. You could choose to completely separate the owner and senior management team from the operation at closing. As a foreign buyer it might make more sense to develop a transition plan in which the owner and/or senior leadership team members stay involved with the business for a specified time period to facilitate client introductions and maintain seamless operations.
Employee Relations After Acquisition. A change of ownership is always stressful for employees. But when the new owner is located overseas, the workplace can become a breeding ground for anxiety. To alleviate their concerns, make sure your post-acquisition plan identifies what you will do to establish solid relationships with the employees.
Public Relations After Acquisition. In many American communities, the acquisition of a company by a foreign firm can create negative PR scenarios. When local consumers lack solid information about the new owner, they tend to fill in the blanks with misinformation that is rooted in cross-cultural fears rather than facts. After you have closed on the business, one of your first assignments should be to conduct a PR campaign to introduce yourself and your company to the locals.
Challenges of Global Ownership. Your post-acquisition plan should also discuss challenges that are typically associated with global business ownership, especially if you haven't owned an international business before. Currency hedging, trade restrictions, travel schedules - anything that has the potential to complicate your life after the sale is fair game in a thorough post-acquisition plan.
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What else will foreign companies need to think about after buying a U.S. company? We welcome your comments, questions and tips regarding post-acquisition considerations for foreign firms that acquire U.S. companies.