Bachelor’s thesis · Technische Hochschule Mittelhessen
A checklist for Mittelstand buyers, built from the literature on why acquisitions succeed or fail.
What I did
“The secret of success is to do the common thing uncommonly well.”
— John D. Rockefeller
If the process of an M&A deal has been covered this extensively in the literature, why do acquisitions still fail so regularly? The conclusion that underlines the practical relevance of this thesis is obvious: there might be success factors that are not directly linked to the structure of a deal, but still make an essential contribution to its success.
Mittelstand companies in particular should take them into account, because a failed takeover can threaten their own existence far faster than a large corporation’s. The immediate trigger was my seminar paper on acquisition finance through MBOs and MBIs.
Horizontal acquisitions and the German Mittelstand are each well covered in the literature; the combination of both is not. The thesis sets itself three goals:
A descriptive approach: a systematic literature review, with no data collection of any kind. Exploratory elements remain nonetheless, because most success factors in the literature had never been adapted to the Mittelstand or to horizontal acquisitions. Literature-based factors and those from my own analysis were kept strictly separate, and merged only in the checklist.
Every success factor sits at one intersection of company function and acquisition phase. One representative check per cell:
| Function | Preparation | Due Diligence | Negotiation | Integration |
|---|---|---|---|---|
| Leadership | Advisers engaged — and own strategic goals clear enough not to be steered by them? | Target’s top management assessed, not just middle, and willingness to abort established? | Walk-away conditions and concession positions defined before sitting down? | Integration run by an integration office, with the owner back on the day-to-day business? |
| Strategy | Acquisition strategy complements the corporate one; brand approach decided upfront? | Synergies quantified on internal numbers, short-term and long-term held apart? | Integration model agreed with the seller — standalone or fully absorbed? | Core business supported rather than risk diversified; strategy piloted on one area first? |
| Organisation | A standing M&A team — without formalising away the speed that makes an SME an SME? | Integration planning continued, functional overlaps surfaced early? | Integration teams, reporting lines and responsibilities settled before closing? | Cross-functional teams, so knowledge moves between the two organisations? |
| Workforce | Key personnel at the target identified and a retention plan already drafted? | Target management assessed on leadership and cultural adaptability, not just HR data? | Key-employee list reconciled with the seller; retention fitted to their culture? | Mentoring in place so knowledge transfers rather than walks out? |
| Planning & Control Systems | Planning and control systems built before diligence starts; documentation complete? | Red-flag diligence before full diligence, with a query portal carrying owners and deadlines? | Performance targets contractually secured, with KPI-based controls and earn-out mechanics? | Integration status shared with the workforce, not only with management? |
| Culture | A culture-focused SWOT run before the expensive diligence begins? | Cultural diligence run only once the other workstreams found no deal breakers? | Joint cultural team from both companies drafting a shared mission statement? | Former owner retained temporarily to carry the culture across? |
Scroll the table sideways to see all four phases →
Not a detailed plan that teaches how to acquire a company — the literature already offers that. It is a supplement that points to the specifics and problem areas of the Mittelstand and of horizontal acquisitions, and it serves its purpose when it is used in addition to thorough preparation and external support.
Every measure is a closed question, answered yes or no. Leadership, Workforce and Planning & Control map to management, HR and controlling; Strategy, Organisation and Culture cut across several functions, and are a signal for cross-functional teams.
Excerpt from the checklist — Leadership, across all four phases
Although actual success is determined in a given phase, the conditions for it are already defined in the phases before.
The integration phase, identified as the most challenging, needs a great deal of groundwork that has to happen earlier. The main target group is therefore the management, which can pass parts of the checklist to other departments.
The next step would be an empirical study of the identified factors, quantitative and qualitative, together with case studies — and the quantification and ranking this thesis does not attempt, so the checklist could tell a buyer where to spend attention first.
Writing this is what pushed me toward acquisition work in the first place. The screening and prioritisation I later did at Viega is the same question from the other side of the desk: which of these targets is integrable, and what would it take.