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What issues can have a negative impact on your business goals?

On Behalf of | Dec 14, 2016 | Mergers & Acquisitions


In the aftermath of a successful merger or acquisition, many people associated with the business entity are probably feeling quite a bit of relief that the complex business transaction is complete, and they are ready to head toward realizing the new goal that was the whole point of the transaction. However, these companies should be aware of some potential problems that could pop up. What issues could have a negative impact on the business goals of companies in Louisiana?

First, personal issues with key personnel could become a major problem for the company. In many companies, there are individuals who have a personal stake in the ownership of the company. What happens if one of those individuals gets divorced? That may seem like a personal legal matter, but what if the ownership stake in the company becomes the subject of that litigation? It can change the dynamics of company leadership.

Or, what if one of the individuals with an ownership stake — and who plays a key role in the day-to-day business operations — has a sudden health issue? What if the health issue is permanent and becomes a disability? Will that individual be able to continue to fulfil their role, or will a transition need to occur? Again, this is another personal issue that could have a substantial impact on the business.

Besides the impact of personal issues, what about the ultimate issue — the death of a partner or owner. Is there a succession plan in place? Is there an agreement in place among business partners that details how the ownership structure of the company will play out upon the death of one partner? These issues aren’t likely to be in the immediate thoughts of business leaders in Louisiana, but it is better to think about them before they become a reality.

In the end, even after a successful merger or acquisition takes place, it is important to have a plan in place for these types of contingencies. Seemingly personal issues, such as a divorce, illness or death can have a major impact on a business. But by being prepared for these contingencies, businesses can continue to operate smoothly.

Source: Green Bay Press-Gazette, “Adviser: 5 dismal D’s can damage your business,” Scott Bushkie, Dec. 9, 2016