First of all, you should ask yourself what the goal of the acquisition should be: Is it to gain new access to the market and thus new customers? Perhaps the competitor’s technologies and production are attractive? Or are the company’s brand and history of interest to the buyer? And depending on that, an offensive or a defensive M&A strategy is the right choice.

Expanding departments: Filling key positions with new staff

If, for example, the aim is to adapt the company’s production or to expand specific departments such as sales or development, it makes more sense to fill key positions in your own company by poaching competitors. Just like in soccer, where one club buys its top striker from another.

New market: Acquire a complete company

However, if the goal of M&A is to conquer a new market and supplement the service portfolio, it makes more sense to acquire the entire company. This consists of a functioning organization, comparable to a sports club that wants to be active not only in soccer, but also in ice hockey. Then it is easier to buy an existing team, coach, administration and stadium.

Conclusion: M&A is the way to go

Consequently, one could say that it is cheaper and easier to buy key positions from the competition if you want to expand small parts of a company. However, if you want to make a big move within a company and, for example, conquer a new market, technologies or patents or expand the service portfolio, M&A can certainly be the better solution.