|Marlen Kruzhkov photo credit: i.bnet.com|
As seen in recent trends, the core of a merger or acquisition is the transfer of capabilities, which involves the restructuring of resource sharing and transferring of functional proficiencies or general management skills. In addition, an increased market power due to the “combination process” can also expand benefit options for the unified company.
What rests on a successful merger is the creation of a sound atmosphere—a business environment that promotes reciprocal understanding, willingness to strengthen cooperation, slack resources, competence to transfer the skills, and understanding of the cause-effect issues of the acquisition.
Atty. Marlen Kruzhkov is a member of the New York Bar and the New Jersey Bar. He is a former Co-Chairman of the Russian Leadership Division of the United Jewish Appeal (UJA) and Chairman and Founder of the Russian Speaking Business Attorneys Network (RUSBAN).
|Marlen Kruzhkov photo credit: freeola.com|
Determinism, value destruction, and leadership vacuum.
Acquisitions have proven to be very effective in augmenting a company’s marketing strength and combating low-key revenue generation. However, not all ventures run seamlessly.
Determinism, the inability to modify the foundation for the acquisition—even when new information that has been previously non-existent is already available—is one of the most common problems that acquisitions encounter. Every acquisition devastates psychic value (the cost that measures the stress of having to think about a transaction), and unless management takes some actions, this will impede the readiness of employees to work on the integration. Additionally, institutional and administrative leaders should have the operative capacity to integrate and achieve synergies. This will help the merger prevent or recover from the destructive effects of determinism.
Atty. Marlen Kruzhkov practices at Gusrae Kaplan Nusbaum PLLC— a New York-based law firm that supports clients in corporate finance transactions by providing a wide array of legal advice on the securities industry. Visit
|From Marlen Kruzhkov|