🧩 Frameworks

M&A framework

Should we buy this company?

Check four things: strategic fit (why this target?), the target's standalone health, synergies (what's 1 + 1 = 3?), and price and risks (can we pay that and integrate it?).

A good deal creates more value than you pay for it.

How to break it down

Acquire?
Strategic fit
Target health
Synergies
Price & risks

🧮 Example

A cement maker buying a rival in a new state: fills a regional gap (fit), profitable (health), shared logistics (synergy), price 12× EBITDA (risk).

🎯 Interview tip

Always ask about integration and culture — most deals fail after signing, not before.

Used in

M&A casesConsulting cases

Learn next

Synergies

Extra value created by combining two companies.

EBITDA

Operating profit before interest, taxes, depreciation and amortisation.

Net present value (NPV)

Future cash, translated into today's money.

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