IPO for Deep Tech: Pros & Cons
Could an IPO be the game-changer your deep tech startup needs to reach new heights? An Initial Public Offering (IPO) represents a pivotal moment for any company, especially for deep tech startups.
Getting the most out of M&A deals is the result of serious strategic planning. All work must be executed within the strict framework of a company’s business strategy – for both buyers and sellers. We shall briefly examine the following steps that impact the efficiency and value creation of the transaction:
The analysis provides management and the board of directors of the acquirer with information that allows them to assess the comparative advantages of a cash proposal compared to an exchange-of-shares offer. Based on the analysis, a decision is made about the candidate, and an effective strategy for negotiating an acquisition is developed.
Value creation should be the priority of the deal. There are ways to increase the value of companies through mergers and acquisitions:
PwC consulting specialists conducted a survey “Creating value beyond the deal” to uncover how senior executives create value for M&A. 600 senior executives from a variety of industries and countries who had completed at least one significant acquisition and divestiture transaction in the past three years participated in the survey. The results were measured using a Total Shareholder Return (TSR) indicator over two periods: one month before the deal announcement and 12 and 24 months after the deal was completed. The majority of respondents (66%) agreed that value creation should be the priority. However, more than half of the acquisitions performed below the industry average in the two years following the deal. Of the participants, 65% cited cultural issues as a barrier to value creation, and “for acquisitions with a significant further loss in value relative to the purchase price,” all respondents said that cultural issues had impeded the realization of the intended benefits. According to the report, 86% of respondents with significant post-transaction value gains conducted a strategic analysis of their portfolio beforehand. (The full report of the study is available on PwC’s website).
Could an IPO be the game-changer your deep tech startup needs to reach new heights? An Initial Public Offering (IPO) represents a pivotal moment for any company, especially for deep tech startups.
An article recently published online with the title “Europe needs more scientists in VC to become a deeptech powerhouse – Tech.eu” highlights the fact that the problem deep-tech startups are facing is still not widely understood.
How can you identify and evaluate the deep tech sectors with the highest potential for transformation? Performing an analysis of promising deep tech sectors involves several key steps. Begin by identifying the deep tech sectors with the most potential for transformation.