Management of transformational programs of mergers and acquisitions of distressed companies

Abstract

The paper aims to develop an integral methodology for managing transformational programs in relation to a specific type of transformation — the processes of mergers and acquisitions with the participation of distressed companies. It highlights the distressed companies’ mergers and acquisitions: its two-stage character when the first step is business recovery, and the second one is its growth or sale; a large amount of investment to restore the business and its integration after the transaction’s completion; the danger of underestimating the problems associated with the market, business processes, resources due to low transparency, distortion of information, limited time for the verifi cation; the need to reach an agreement not only among shareholders, but also with the creditors of the indebted business regarding the basic procedures and deadlines, the occurrence of claim work, court expenses, etc. The authors also formulate the principles and stages of such project management: an assessment of the feasibility of acquiring a distressed company (preliminary stage), the stage of the transaction and subsequent integration. A model of the integration process is developed on the example of broiler production as an industry where mergers and acquisitions with the participation of distressed companies are common. It presents a list of project groups and their problems and suggests measures for obtaining synergistic effect in the areas of “market”, “business processes”, “resources (material, labor, financial)”. The principles of coordinating the activities of project groups, ensuring their integration into the program are the following: establishing a hierarchy of projects, their horizontal, vertical, network connections; development of a template of documents for the informational exchange, ongoing monitoring, preparation of interim and fi nal reports; approval of a schedule for the informational exchange, reporting; establishing indicators for monitoring for each project and criteria for the success of their implementation (qualitative or quantitative).