A quick way of figuring out if a deal makes sense is to ask the following questions:
1. How does this deal fit my strategy?
2. Is the price supported by current financial results?
3. How do I pay for this?
4. What is the right price, strategically and financially?
5. What are the risk factors?
6. Is the expected return worth the risk?
7. What are the seller's reasons for selling?
8. What is upside potential and what are barriers to their realization?
Each of these questions involve more depth, complexity and permutations, but these are the essential questions.
Sunday, February 28, 2010
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