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Business Acquisition Plan: What to Include in 2024 (+ Template)

Kison Patel is the Founder and CEO of DealRoom, a Chicago-based diligence management software that uses Agile principles to innovate and modernize the finance industry. As a former M&A advisor with over a decade of experience, Kison developed DealRoom after seeing first hand a number of deep-seated, industry-wide structural issues and inefficiencies.

A business acquisition plan is an important component of planning for an M&A transaction, regardless of whether you require external financing. A solid business acquisition plan should lay out the rationale for the investment, and how it will add value for the entity. In this article, FirmRoom takes a closer look at how these documents should be crafted.

Understanding Business Acquisition Plan

A business acquisition plan is a strategy document, which serves the purpose of a business plan for an M&A transaction.

It outlines the motives behind a transaction, profiles of the companies involved in the transaction, how the transaction will generate value for the entity which is driving it, how the two companies will be integrated, and how the merged company (or simply acquired company in the case of an investment firm acquiring a company) is expected to perform.

Reasons to Have a Business Acquisition Plan

An acquisition plan provides its users with a roadmap to making the transaction a success. Even before the transaction is initiated, it acts as a reminder to the sponsors, what they’re looking for, why they’re looking for it, and how they’re going to ensure that the transaction is a success.

In general terms, the reasons to have a business acquisition plan are:

Strategic alignment

The overriding goal of a business acquisition plan, as the opening text alludes to, is strategic alignment: ensuring that those undertaking the deal, for lack of a better expression, ‘stick to the plan’, around the motives and means for making the deal a success.

Valuation and pricing

The plan should include strategies and methodologies for valuing the target company. It should guide the deal participants on how to determine a fair value for the target, assess synergies, and estimate future financial returns. It also sets a limit on how much the company can extend itself financially for a deal to occur.

Financing and resource allocation

Financing (sources and uses of funds) is just one part of the resource allocation conundrum. The business acquisition plan also outlines the working capital needs, who works where, how expenditures are going to shift, what capital assets are required, and more.

Business Acquisition Plan Template

The insight that FirmRoom has gained from working with hundreds of companies on thousands of transaction, have been collated in a business acquisition plan template.

This provides a detailed roadmap of what should be included in an effective business acquisition plan, ensuring that its users have everything in place for the conclusion of a successful transaction.

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Creating a Business Acquisition Plan Step-by-Step

While developing a business acquisition plan is recommended, having an ineffective acquisition plan is worse than having none at all.

The document has to be watertight, creating no doubt in the reader’s mind about the benefits of an acquisition.

A strong business acquisition plan should make the reader think that it makes far more sense to go ahead with the transaction than for the company to continue in the status quo.

That being said, the following should only be seen as a rough step-by-step guide to putting together a business acquisition plan:

Strategy development

Best practice:

• Identify where the company wants to be in each of the next five years, possibly on a month-by-month basis, and how it plans to get there. See here for example.
• Identify the key performance indicators that need to be tracked to ensure that the company meets these objectives.
• Based on both of the above, ask whether an acquisition is a crucial part of the company achieving those objectives, before moving forward.

Identifying and evaluating target companies

• Understand where the companies that fit into the strategy will be found , and be thorough and objective in the search for them.
• Be realistic about the companies that can be acquired/merged with, including valuations ,  so as not to waste resources for other companies and your own.
• Remember that just because a company is the only one that’s available, it doesn’t mean that a transaction is a good idea.

Due Diligence

• Use technology ; any M&A practitioner that decides against using a sound technology platform for due diligence is doomed to failure.
• Adopt a mindset where due diligence is considered an investment in the acquisition, rather than a cost to your own company;
• Do not fall for the M&A acquirer’s fallacy of ‘we’ve come this far, so we can’t go back.’ If due diligence says the deal isn’t right, it isn’t.
• Begin the post-merger integration phase as soon as the deal begins to look like a realistic possibility (something which DealRoom is designed to cater for).

Deal structure and negotiation

• Leverage the findings of due diligence to create a more informed negotiation process.
• Remember that there will be back and forth with the seller, and they can be reasonably expected to overvalue their asset.
• Consider all market outcomes (i.e. downturns, current value of stock vs. future value, etc.) when creating an offer. Avoid irrational exuberance.

Post merger integration (PMI)

• Keep in mind at all times during the PMI phase that this is where most of the value can be generated and lost in a transaction.
• As mentioned, begin the process as soon as possible. If the transaction is visible on the horizon, you need to start thinking about its integration.
• Don’t write this off as a ‘soft’ or unnecessary part of the transaction - it won’t be soft when it impacts on your income statement.

Common mistakes to avoid when writing a business acquisition plan

Despite plenty of advice to the contrary, enthusiastic CXOs often write acquisition plans which fail to avoid the pitfalls.

These are among the most common:

Putting the acquisition before the strategy

The acquisition is part of the overall strategy, not the other way around. Companies that are approached by others about a deal, and then somehow convince themselves that there is a strong rationale for a deal, fall foul to this backwards logic.

Management hubris

M&A is an area ripe with management hubris (take a glance at Google Scholar at all the academic texts that link the two). That means management hubris inevitably finds its way into business acquisition plans. Avoid it at all costs - it’s a highly costly behavioural pattern for companies of all sizes.

Lack of detail

The business acquisition plan is a strategy document, not a marketing one. That is to say, it should break down in a step-by-step fashion how the deal will generate value. The more detailed the better. “Creating an outstanding organization” is great, but writing it in the business acquisition plan won’t add any value.

Business acquisition plan template

A business acquisition plan is a hugely worthwhile document that all M&A practitioners should write in order to discern the value of a transaction and how that value can be extracted. It is the business plan for an M&A transaction.

Get your free template below to receive guidelines on how to create the document and make it work for your transaction.

Frequently Asked Questions (FAQs)

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The six types of successful acquisitions

There is no magic formula to make acquisitions successful. Like any other business process, they are not inherently good or bad, just as marketing and R&D aren’t. Each deal must have its own strategic logic. In our experience, acquirers in the most successful deals have specific, well-articulated value creation ideas going in. For less successful deals, the strategic rationales—such as pursuing international scale, filling portfolio gaps, or building a third leg of the portfolio—tend to be vague.

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Empirical analysis of specific acquisition strategies offers limited insight, largely because of the wide variety of types and sizes of acquisitions and the lack of an objective way to classify them by strategy. What’s more, the stated strategy may not even be the real one: companies typically talk up all kinds of strategic benefits from acquisitions that are really entirely about cost cutting. In the absence of empirical research, our suggestions for strategies that create value reflect our acquisitions work with companies.

In our experience, the strategic rationale for an acquisition that creates value typically conforms to at least one of the following six archetypes: improving the performance of the target company, removing excess capacity from an industry, creating market access for products, acquiring skills or technologies more quickly or at lower cost than they could be built in-house, exploiting a business’s industry-specific scalability, and picking winners early and helping them develop their businesses.

Six archetypes

An acquisition’s strategic rationale should be a specific articulation of one of these archetypes, not a vague concept like growth or strategic positioning, which may be important but must be translated into something more tangible. Furthermore, even if your acquisition is based on one of the archetypes below, it won’t create value if you overpay.

Improve the target company’s performance

Improving the performance of the target company is one of the most common value-creating acquisition strategies. Put simply, you buy a company and radically reduce costs to improve margins and cash flows. In some cases, the acquirer may also take steps to accelerate revenue growth.

Pursuing this strategy is what the best private-equity firms do. Among successful private-equity acquisitions in which a target company was bought, improved, and sold, with no additional acquisitions along the way, operating-profit margins increased by an average of about 2.5 percentage points more than those at peer companies during the same period. 1 1. Viral V. Acharya, Moritz Hahn, and Conor Kehoe, “Corporate governance and value creation: Evidence from private equity,” Social Science Research Network working paper, February 19, 2010. This means that many of the transactions increased operating-profit margins even more.

Keep in mind that it is easier to improve the performance of a company with low margins and low returns on invested capital (ROIC) than that of a high-margin, high-ROIC company. Consider a target company with a 6 percent operating-profit margin. Reducing costs by three percentage points, to 91 percent of revenues, from 94 percent, increases the margin to 9 percent and could lead to a 50 percent increase in the company’s value. In contrast, if the operating-profit margin of a company is 30 percent, increasing its value by 50 percent requires increasing the margin to 45 percent. Costs would need to decline from 70 percent of revenues to 55 percent, a 21 percent reduction in the cost base. That might not be reasonable to expect.

Consolidate to remove excess capacity from industry

As industries mature, they typically develop excess capacity. In chemicals, for example, companies are constantly looking for ways to get more production out of their plants, even as new competitors, such as Saudi Arabia in petrochemicals, continue to enter the industry.

The combination of higher production from existing capacity and new capacity from recent entrants often generates more supply than demand. It is in no individual competitor’s interest to shut a plant, however. Companies often find it easier to shut plants across the larger combined entity resulting from an acquisition than to shut their least productive plants without one and end up with a smaller company.

Reducing excess in an industry can also extend to less tangible forms of capacity. Consolidation in the pharmaceutical industry, for example, has significantly reduced the capacity of the sales force as the product portfolios of merged companies change and they rethink how to interact with doctors. Pharmaceutical companies have also significantly reduced their R&D capacity as they found more productive ways to conduct research and pruned their portfolios of development projects.

While there is substantial value to be created from removing excess capacity, as in most M&A activity the bulk of the value often accrues to the seller’s shareholders, not the buyer’s. In addition, all the other competitors in the industry may benefit from the capacity reduction without having to take any action of their own (the free-rider problem).

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Accelerate market access for the target’s (or buyer’s) products.

Often, relatively small companies with innovative products have difficulty reaching the entire potential market for their products. Small pharmaceutical companies, for example, typically lack the large sales forces required to cultivate relationships with the many doctors they need to promote their products. Bigger pharmaceutical companies sometimes purchase these smaller companies and use their own large-scale sales forces to accelerate the sales of the smaller companies’ products.

IBM, for instance, has pursued this strategy in its software business. Between 2010 and 2013, IBM acquired 43 companies for an average of $350 million each. By pushing the products of these companies through IBM’s global sales force, IBM estimated that it was able to substantially accelerate the acquired companies’ revenues, sometimes by more than 40 percent in the first two years after each acquisition. 2 2. IBM investor briefing 2014, ibm.com.

In some cases, the target can also help accelerate the acquirer’s revenue growth. In Procter & Gamble’s acquisition of Gillette, the combined company benefited because P&G had stronger sales in some emerging markets, Gillette in others. Working together, they introduced their products into new markets much more quickly.

Get skills or technologies faster or at lower cost than they can be built

Many technology-based companies buy other companies that have the technologies they need to enhance their own products. They do this because they can acquire the technology more quickly than developing it themselves, avoid royalty payments on patented technologies, and keep the technology away from competitors.

For example, Apple bought Siri (the automated personal assistant) in 2010 to enhance its iPhones. More recently, in 2014, Apple purchased Novauris Technologies, a speech-recognition-technology company, to further enhance Siri’s capabilities. In 2014, Apple also purchased Beats Electronics, which had recently launched a music-streaming service. One reason for the acquisition was to quickly offer its customers a music-streaming service, as the market was moving away from Apple’s iTunes business model of purchasing and downloading music.

Cisco Systems, the network product and services company (with $49 billion in revenue in 2013), used acquisitions of key technologies to assemble a broad line of network-solution products during the frenzied Internet growth period. From 1993 to 2001, Cisco acquired 71 companies, at an average price of approximately $350 million. Cisco’s sales increased from $650 million in 1993 to $22 billion in 2001, with nearly 40 percent of its 2001 revenue coming directly from these acquisitions. By 2009, Cisco had more than $36 billion in revenues and a market cap of approximately $150 billion.

Exploit a business’s industry-specific scalability

Economies of scale are often cited as a key source of value creation in M&A. While they can be, you have to be very careful in justifying an acquisition by economies of scale, especially for large acquisitions. That’s because large companies are often already operating at scale. If two large companies are already operating that way, combining them will not likely lead to lower unit costs. Take United Parcel Service and FedEx, as a hypothetical example. They already have some of the largest airline fleets in the world and operate them very efficiently. If they were to combine, it’s unlikely that there would be substantial savings in their flight operations.

Economies of scale can be important sources of value in acquisitions when the unit of incremental capacity is large or when a larger company buys a subscale company. For example, the cost to develop a new car platform is enormous, so auto companies try to minimize the number of platforms they need. The combination of Volkswagen, Audi, and Porsche allows all three companies to share some platforms. For example, the VW Toureg, Audi Q7, and Porsche Cayenne are all based on the same underlying platform.

Some economies of scale are found in purchasing, especially when there are a small number of buyers in a market with differentiated products. An example is the market for television programming in the United States. Only a handful of cable companies, satellite-television companies, and telephone companies purchase all the television programming. As a result, the largest purchasers have substantial bargaining power and can achieve the lowest prices.

While economies of scale can be a significant source of acquisition value creation, rarely are generic economies of scale, like back-office savings, significant enough to justify an acquisition. Economies of scale must be unique to be large enough to justify an acquisition.

Pick winners early and help them develop their businesses

The final winning strategy involves making acquisitions early in the life cycle of a new industry or product line, long before most others recognize that it will grow significantly. Johnson & Johnson pursued this strategy in its early acquisitions of medical-device businesses. J&J purchased orthopedic-device manufacturer DePuy in 1998, when DePuy had $900 million of revenues. By 2010, DePuy’s revenues had grown to $5.6 billion, an annual growth rate of about 17 percent. (In 2011, J&J purchased Synthes, another orthopedic-device manufacturer, so more recent revenue numbers are not comparable.) This acquisition strategy requires a disciplined approach by management in three dimensions. First, you must be willing to make investments early, long before your competitors and the market see the industry’s or company’s potential. Second, you need to make multiple bets and to expect that some will fail. Third, you need the skills and patience to nurture the acquired businesses.

Harder strategies

Beyond the six main acquisition strategies we’ve explored, a handful of others can create value, though in our experience they do so relatively rarely.

Roll-up strategy

Roll-up strategies consolidate highly fragmented markets where the current competitors are too small to achieve scale economies. Beginning in the 1960s, Service Corporation International, for instance, grew from a single funeral home in Houston to more than 1,400 funeral homes and cemeteries in 2008. Similarly, Clear Channel Communications rolled up the US market for radio stations, eventually owning more than 900.

This strategy works when businesses as a group can realize substantial cost savings or achieve higher revenues than individual businesses can. Service Corporation’s funeral homes in a given city can share vehicles, purchasing, and back-office operations, for example. They can also coordinate advertising across a city to reduce costs and raise revenues.

Size is not what creates a successful roll-up; what matters is the right kind of size. For Service Corporation, multiple locations in individual cities have been more important than many branches spread over many cities, because the cost savings (such as sharing vehicles) can be realized only if the branches are near one another. Roll-up strategies are hard to disguise, so they invite copycats. As others tried to imitate Service Corporation’s strategy, prices for some funeral homes were eventually bid up to levels that made additional acquisitions uneconomic.

Consolidate to improve competitive behavior

Many executives in highly competitive industries hope consolidation will lead competitors to focus less on price competition, thereby improving the ROIC of the industry. The evidence shows, however, that unless it consolidates to just three or four companies and can keep out new entrants, pricing behavior doesn’t change: smaller businesses or new entrants often have an incentive to gain share through lower prices. So in an industry with, say, ten companies, lots of deals must be done before the basis of competition changes.

Enter into a transformational merger

A commonly mentioned reason for an acquisition or merger is the desire to transform one or both companies. Transformational mergers are rare, however, because the circumstances have to be just right, and the management team needs to execute the strategy well.

Transformational mergers can best be described by example. One of the world’s leading pharmaceutical companies, Switzerland’s Novartis, was formed in 1996 by the $30 billion merger of Ciba-Geigy and Sandoz. But this merger was much more than a simple combination of businesses: under the leadership of the new CEO, Daniel Vasella, Ciba-Geigy and Sandoz were transformed into an entirely new company. Using the merger as a catalyst for change, Vasella and his management team not only captured $1.4 billion in cost synergies but also redefined the company’s mission, strategy, portfolio, and organization, as well as all key processes, from research to sales. In every area, there was no automatic choice for either the Ciba or the Sandoz way of doing things; instead, the organization made a systematic effort to find the best way.

Novartis shifted its strategic focus to innovation in its life sciences business (pharmaceuticals, nutrition, and products for agriculture) and spun off the $7 billion Ciba Specialty Chemicals business in 1997. Organizational changes included structuring R&D worldwide by therapeutic rather than geographic area, enabling Novartis to build a world-leading oncology franchise.

Across all departments and management layers, Novartis created a strong performance-oriented culture supported by shifting from a seniority- to a performance-based compensation system for managers.

The final way to create value from an acquisition is to buy cheap—in other words, at a price below a company’s intrinsic value. In our experience, however, such opportunities are rare and relatively small. Nonetheless, although market values revert to intrinsic values over longer periods, there can be brief moments when the two fall out of alignment. Markets, for example, sometimes overreact to negative news, such as a criminal investigation of an executive or the failure of a single product in a portfolio with many strong ones.

Such moments are less rare in cyclical industries, where assets are often undervalued at the bottom of a cycle. Comparing actual market valuations with intrinsic values based on a “perfect foresight” model, we found that companies in cyclical industries could more than double their shareholder returns (relative to actual returns) if they acquired assets at the bottom of a cycle and sold at the top. 3 3. Marco de Heer and Timothy Koller, “ Valuing cyclical companies ,” McKinsey Quarterly , May 2000.

While markets do throw up occasional opportunities for companies to buy targets at levels below their intrinsic value, we haven’t seen many cases. To gain control of a target, acquirers must pay its shareholders a premium over the current market value. Although premiums can vary widely, the average ones for corporate control have been fairly stable: almost 30 percent of the preannouncement price of the target’s equity. For targets pursued by multiple acquirers, the premium rises dramatically, creating the so-called winner’s curse. If several companies evaluate a given target and all identify roughly the same potential synergies, the pursuer that overestimates them most will offer the highest price. Since it is based on an overestimation of the value to be created, the winner pays too much—and is ultimately a loser. 4 4. K. Rock, “Why new issues are underpriced,” Journal of Financial Economics , 1986, Volume 15, pp. 187–212. A related problem is hubris, or the tendency of the acquirer’s management to overstate its ability to capture performance improvements from the acquisition. 5 5. R. Roll, “The hubris hypothesis of corporate takeovers,” Journal of Business , 1986, Volume 59, Number 2, pp. 197–216.

Since market values can sometimes deviate from intrinsic ones, management must also beware the possibility that markets may be overvaluing a potential acquisition. Consider the stock market bubble during the late 1990s. Companies that merged with or acquired technology, media, or telecommunications businesses saw their share prices plummet when the market reverted to earlier levels. The possibility that a company might pay too much when the market is inflated deserves serious consideration, because M&A activity seems to rise following periods of strong market performance. If (and when) prices are artificially high, large improvements are necessary to justify an acquisition, even when the target can be purchased at no premium to market value.

By focusing on the types of acquisition strategies that have created value for acquirers in the past, managers can make it more likely that their acquisitions will create value for their shareholders.

Marc Goedhart is a senior expert in McKinsey’s Amsterdam office, Tim Koller is a partner in the New York office, and David Wessels, an alumnus of the New York office, is an adjunct professor of finance and director of executive education at the University of Pennsylvania’s Wharton School. This article, updated from the original, which was published in 2010, is excerpted from the sixth edition of Valuation: Measuring and Managing the Value of Companies , by Marc Goedhart, Tim Koller, and David Wessels (John Wiley & Sons, 2015).

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The phrase mergers and acquisition (abbreviated M&A) refers to the aspect of corporate strategy, corporate finance, and management dealing with the buying, selling, and combining of different companies that can aid, finance, or help a growing company in a given industry grow rapidly without having to create another business entity.

Merger And Acquisition Business Plan (M&A)

Merging your company with another, or taking on someone else’s business, means also merging your vision and goals with someone else’s dreams, concepts, and commitments. A professionally prepared merger and acquisition Business Plan can smooth the way, letting you get back to business fast.

At Wise Business Plans, our team of professional MBA  business plan writers , researchers, and financial experts is dedicated to providing exceptional services tailored for the merger and acquisition process.

Our mission is to empower businesses during mergers and acquisitions by creating affordable, custom M&A business plans packed with relevant strategies, positioning them for success throughout every stage of their integration and growth journey.

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Custom Merger and Acquisition Business Plans

Interested in a merger or acquisition business plan?  A successful merger or acquisition requires several steps before executing the transaction and integrating the target company:

1. Determine Objectives

Mergers and acquisition proponents anticipate that the combined companies net cash flow and financial returns will be higher than the sum of the stand-alone companies. Incremental cash flow and returns should result from complementing each other’s strengths and compensating for weaknesses.

Available synergies are the reason for a combination. The value of the synergies determines the price of the merger or acquisition.

Setting clear objectives from the start focuses management on how an acquisition can create synergies. This approach improves the likelihood of a successful transaction while minimizing wasted effort. Common objectives for pursuing mergers and acquisitions include:

• Achieve Economies of Scale

Merging with or acquiring a company that serves the same markets can offer economies of scale in:

• Manufacturing
• Distribution
• Sales and marketing
• Administrative functions

Consider a manufacturing company that acquires a competitor with manufacturing plants that produce the same products and/or serve the same markets. The combined companies may reduce the number of plants while serving existing and future demand. The production capacity of the remaining plants must be larger than the two company’s original output. Underutilized capacity, more efficient equipment, and better processes are some reasons this could occur.

Rationalizing administrative functions is often a basis for combining companies. Headquarter costs are targeted for reduction.

• Expand Product or Service Offerings

  A merger or acquisition can expand the combined company’s product or service offerings.

An office equipment and supplies distributor could create value by acquiring a laptop computer and personal electronic devices distributor. Providing these products could increase sales through existing channels with little added expense.

An accounting firm might consider acquiring a company that installs accounting software. The acquisition could expand its services to existing clients and add new clients.

• Enter New Markets

Entering new markets is another common objective for combining companies. A new market can be a geographic market, a new product, or service market.

A company that purchases a foreign company to establish a presence in a foreign market is an example of entering a new geography.

Entering a new product or service differs from expanding product or service offerings. The new market has no relationship or a slight relationship to the company’s current business.

• Maintain Competitive Position

A company may seek to acquire a competitor to increase its market share.

• Stabilize the Company

A company whose financial performance is faltering may acquire a healthier company to stabilize financial results. Over time, the acquisition would increase profitability and cash flow.

Many mergers and acquisitions can create synergies in more than one way. It is important to prioritize the company’s objectives for a merger or acquisition. The priority is based on what the company’s needs to grow and best increase financial returns. The company’s focus on the priority objective supports disciplined decisions and maximizes the potential for success. Additional synergies will just enhance value creation.

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2. Qualify Targets

Having determined a priority objective, the next step is to identify and qualify targets.

Targets are identified in several ways. Depending on the company’s objective, competitors, suppliers, and even customers can be appropriate targets. If the company has an existing relationship with a potential target’s senior management, direct contact may be appropriate. Or the company could ask another party to gauge interest in a merger or acquisition. This could be be achieve by”

• an outside executive with a relationship with the target
• an investment banker
• a legal firm or an industry trade association
• private equity firms
• angel investors
• business brokers.

Once there is agreement to investigate a merger or acquisition, the formal due diligence process begins. This critical step enables the company to evaluate the target’s competitive position and confirm that the target could address the company’s primary objective. The company can also assess the financial condition of the target, and identify material risks and opportunities. Due diligence qualifies the target through several steps:

a. Meet with the target’s senior executives for the following::

• Discuss broad parameters of a potential merger or acquisition
• Outline the due diligence process
• Discuss access to employees, facilities, accounting and other records and customers
• Set a schedule for completing due diligence and submitting an initial offer

b. Meet with functional area senior managers in:

• Finance and accounting
• Information systems

c. Tour facilities.

d. Analyze the target’s records including:

• Asset maintenance
• Distribution sales volumes and pricing
• general ledger
• bank accounts
• accounts receivable and payable
• fixed assets and capital investments
• short and long term debt

Meet with major customers (and smaller customers, if practical). Obtain customer opinions on the target’s products, services and operations. Ask customers for their expected volume of business with the target over the next three to five years.

3. Draft A Custom Merger and Acquisition Business Plan

Using the information obtained with due diligence, draft a merger and acquisition business plan for internal management approval. This will be the basis of business plans used for negotiations with the target and financing parties.

The M&A business plan should focus on how the acquisition will create value through synergies created by the combination of the company and the target. The plan could include an analysis demonstrating that acquiring the target will have one or more of the following impacts:

• Create economies of scale resulting in reduced operating expenses.
• expanding products and services
• entering new markets
• enabling price increases above expectations

The business plan contains the following sections:

a. Executive Summary – Include the following:

• An outline of the strategic objectives for acquiring the target
• An estimated value of expected synergies
• The assumptions about synergy opportunities
• A summarized financial return analysis that demonstrates the company’s return targets are equaled or exceeded
• A discussion of potential risks and opportunities
• A schedule for executing the transaction
• A discussion of integration issues including potential cultural differences with the target

b. Competitive Landscape – Identify the target’s primary products/services, markets and competitors. Describe how the target’s strategy (low cost/high volume; premium price/premium quality; unique product attributes) fits the company’s objectives.

c. Volume and Revenue – Discuss volume and revenue. Include analysis of the company and target individually, and the combined companies. Explain expected synergies. Discuss in detail each product, service and customer that accounts for a significant amount of volume or revenue (e.g., 10%). Provide marketing and sales plans.

Include graphic presentations of volume and revenue to increase understanding of the company and the target. Demonstrate how a combination will create value.

d. Operating Expenses – Identify major expenses and the basis for planned amounts stated (i.e., variable with volume, fixed over medium to long term, new or increased because of specific event). Identify expected synergies.

e. Capital Expenditures – Provide a schedule of capital expenditures over the plan horizon, identifying significant projects. State the rationale and expectations for each significant project.

f. Financial Statements – Provide an integrated balance sheet, income statement and cash flow statement for three (3) years of actual results. Include a plan/forecast for the plan horizon. Provide summary statements and planning assumptions in the body of the plan. Include detailed financial statements as an attachment.

g. Sources and Uses – Provide a table indicating the sources of funds for the transaction and the uses of those funds (see example below).

Sources and Uses of Funds

Include a schedule for use of the funds.

h. Estimated Financial Returns – Present the estimated financial returns based on the planned financial statements. If necessary, summarize the presentation in the body of the plan and provide a detailed presentation as an attachment.

i. Financial Ratios – Include financial ratios based on lender requirements post transaction over the plan horizon.

The merger and acquisition business plan will be used to determine the estimated value of the target and the price the company offers. It is the basis of negotiation with the target. The company must prove that the synergies in the business plan can be achieved. The target must be acquired for a value that allows the company to meet its financial return objectives.

A distinguished member of our business plan writing team , Tom Loftus, MBA has served as the Chief Financial Officer of two companies and Senior Vice President, Finance / Treasurer of Genesee & Wyoming Inc., a mid-size company listed on the New York Stock Exchange. Mr. Loftus has created numerous merger and acquisition business plans and developed financial models for startup financing, acquisition opportunities, project and corporate financing transactions, government grant and loan applications and capital authorization requests.

Mr. Loftus is proficient in corporate valuations, operations planning, obtaining grant and loan funding and organization design for finance and accounting. He has extensive experience negotiating purchase and sale agreements and long term supply agreements with private companies, debt and equity financing agreements with commercial bankers, investment bankers and government agencies.

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Acquisition of Fusion completed

AstraZeneca today announced the successful completion of the acquisition of Fusion Pharmaceuticals Inc., a clinical-stage biopharmaceutical company developing next-generation radioconjugates (RCs). The acquisition marks a major step forward in AstraZeneca delivering on its ambition to transform cancer treatment and outcomes for patients by replacing traditional regimens like chemotherapy and radiotherapy with more targeted treatments.

This acquisition complements AstraZeneca’s leading oncology portfolio with the addition of the Fusion pipeline of RCs, including their most advanced programme, FPI-2265, a potential new treatment for patients with metastatic castration-resistant prostate cancer (mCRPC), and brings new expertise and pioneering R&D, manufacturing and supply chain capabilities in actinium-based RCs to AstraZeneca. It also strengthens AstraZeneca’s presence in and commitment to Canada.

As a result of the acquisition, Fusion has become a wholly owned subsidiary of AstraZeneca, with operations in Canada and the US.

Financial considerations Under the terms of the definitive agreement, AstraZeneca, through a subsidiary, has acquired all of Fusion’s outstanding shares pursuant to a plan of arrangement for a price of $21.00 per share in cash at closing plus a non- transferable contingent value right of $3.00 per share in cash payable upon the achievement of a specified regulatory milestone prior to 31 st August, 2029. Combined, the upfront payment and maximum potential contingent value payment, if achieved, represent a transaction value of approximately $2.4bn. As part of the transaction, AstraZeneca acquired the cash, cash equivalents and short-term investments on Fusion’s balance sheet, which totalled $211m as of 31 st March 2024. Fusion shares will be delisted from the Nasdaq Stock Market and deregistered under the U.S. Securities Exchange Act of 1934 and Fusion has applied to cease to be a reporting issuer under applicable Canadian securities laws.

Canadian Early Warning Disclosure Following completion of the acquisition, 15863210 Canada Inc. (the “ Purchaser ”), a wholly-owned, indirect subsidiary of AstraZeneca, has beneficial ownership and control over 85,692,265 Fusion shares, being 100% of the issued and outstanding Fusion shares. The value, in Canadian dollars, of the consideration paid per Fusion share and in total (representing, in each case the total of the upfront payment and maximum potential contingent value payment) was C$32.72 per share and C$2,804,219,198.25 in total (based on the Bank of Canada’s exchange rate as of June 3, 2024 being C$1.00 to $0.7334).

Fusion’s head office is located at 270 Longwood Road South Hamilton, Ontario, L8P 0A6. The Purchaser’s head office is located at Suite 4000 –199 Bay Street, Toronto, Ontario M5L 1A9.

All figures in this news release are denominated in United States dollars, unless otherwise stated.

The disclosure in this section is being provided pursuant to National Instrument 62-103 – The Early Warning System and Related Take-Over Bid and Insider Reporting Issuers of the Canadian Securities Administrators .  An early warning report will be filed under Fusion’s profile on SEDAR+ ( www.sedarplus.ca ) containing additional information respecting the foregoing matters. Further information and a copy of the early warning report may be obtained by contacting the Investor Relations Team with contact details available here .

Radioconjugates in oncology Radioconjugates (RCs) combine the precise targeting of antibodies, small molecules or peptides with potent medical radioisotopes to deliver radiation directly to cancer cells. By seeking out cancer cells, RCs provide a more precise mechanism of cancer cell killing compared with traditional radiation therapy, with the goal of improving efficacy while minimising toxicity on healthy cells. RCs are administered via systemic delivery, which enables their use in tumour types not accessible to external beam radiation and the targeting of cancer cells that have spread from the main tumour to other sites in the body.

About FPI-2265 FPI-2265 is an actinium-225 based PSMA-targeting RC for mCRPC, currently in a Phase II trial.

Actinium-225 emits alpha particles and holds the promise of being a next-generation radioisotope in cancer treatment. By delivering a greater radiation dose over a shorter distance, alpha particles such as actinium-225 have the potential for more potent cancer cell killing, and targeted delivery, thereby minimising damage to surrounding healthy tissue.

AstraZeneca in oncology AstraZeneca is leading a revolution in oncology with the ambition to provide cures for cancer in every form, following the science to understand cancer and all its complexities to discover, develop and deliver life-changing medicines to patients.

The Company’s focus is on some of the most challenging cancers. It is through persistent innovation that AstraZeneca has built one of the most diverse portfolios and pipelines in the industry, with the potential to catalyse changes in the practice of medicine and transform the patient experience.

AstraZeneca has the vision to redefine cancer care and, one day, eliminate cancer as a cause of death.

Forward-looking statements This announcement may include statements that are not statements of historical fact, or “forward-looking statements,” including with respect to AstraZeneca’s acquisition of Fusion. Such forward looking statements include, but are not limited to, AstraZeneca’s beliefs and expectations and statements about the contingent milestone payment, benefits sought to be achieved in AstraZeneca’s acquisition of Fusion, the potential effects of the acquisition on AstraZeneca, as well as the expected benefits and success of FPI-2265 and other pipeline products or any combination product and the filing of the Purchaser’s early warning report on SEDAR+. These statements are based upon the current beliefs and expectations of AstraZeneca’s management and are subject to significant risks and uncertainties. There can be no guarantees that FPI-2265 or any other pipeline products will receive the necessary regulatory approvals or prove to be commercially successful if approved. If underlying assumptions prove inaccurate or risks or uncertainties materialise, actual results may differ materially from those set forth in the forward-looking statements.

Risks and uncertainties include, but are not limited to, the possibility that the achievement of the specified milestone described in the contingent value rights agreement may take longer to achieve than expected or may never be achieved and the resulting contingent milestone payment may never be realised; general industry conditions and competition; general economic factors, including interest rate and currency exchange rate fluctuations; the impact of COVID 19; the impact of pharmaceutical industry regulation and health care legislation in the United States and internationally; competition from other products; and challenges inherent in new product development, including obtaining regulatory approval.

AstraZeneca undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise, except to the extent required by law. Additional factors that could cause results to differ materially from those described in the forward-looking statements can be found in AstraZeneca’s Annual Report on Form 20-F for the year ended 31 st December 2023 and Fusion’s Annual Report on Form 10‑K for the year ended 31 st December 2023 and Quarterly Report on Form 10-Q for the quarter ended 31 st March, 2024, in each case as amended by any subsequent filings made with the SEC. These and other filings made by AstraZeneca and Fusion with the SEC are available at www.sec.gov.

AstraZeneca AstraZeneca (LSE/STO/Nasdaq: AZN) is a global, science-led biopharmaceutical company that focuses on the discovery, development, and commercialisation of prescription medicines in Oncology, Rare Diseases, and BioPharmaceuticals, including Cardiovascular, Renal & Metabolism, Respiratory & Immunology and Vaccines & Immune Therapies. Based in Cambridge, UK, AstraZeneca operates in over 100 countries and its innovative medicines are used by millions of patients worldwide. Please visit  astrazeneca.com  and follow the Company on social media  @AstraZeneca

Contacts For details on how to contact the Investor Relations Team, please click here . For Media contacts, click here .

Adrian Kemp Company Secretary AstraZeneca PLC

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How to plan and execute successful mergers and acquisitions

Lucid Content

Reading time: about 12 min

A merger is defined as two or more companies mutually agreeing to come together to form a new company.

An acquisition occurs when one company takes over another company. The purchasing company buys a controlling interest or the entire business operation, including assets. The purchased company is absorbed by the purchasing company and a new company is not formed.

There are many reasons why mergers and acquisitions occur, all of which ultimately boil down to economic reasons—you want to make more money while spending less. Common reasons for mergers and acquisitions include:

• Decrease the competition.
• Increase operational capacity and efficiency.
• Grow market share.
• Increase revenue and decrease costs.
• Diversify products or services.
• Acquire unique, patented technology that fits well with the acquiring company.
• Combine similar companies, products, technologies, and efforts.

Let's discuss the lifecycle of mergers and acquisitions and outline the steps you need to take in order to be successful.

Mergers and acquisitions life cycle

The mergers and acquisitions (M&A) life cycle is broken down into three categories: Strategy, Execution, and Integration.

Strategic planning helps protect you from M&A failures. Just because you want to buy a company doesn’t mean you should buy that company. There are several questions you should ask yourself when researching target companies.

• Why do you want to acquire, or merge with, another company?
• What is your business objective?
• Do the target company’s products or services fit with your objectives?
• What value will the deal bring you?
• What is the value of the target company?
• Does the company culture fit with your company?

These types of questions can help you narrow your choices as you screen the companies you are interested in, determine target company valuations, structure deals, and analyze how your business decisions will give you an advantage in the current market.

Importance of synergy

Synergy is a combined action or operation. Many companies decide to merge with or acquire another business based on potential synergies that can come from combining similar products and technologies. The following are some benefits that synergy can bring when companies merge:

• Combine workforces—Identify and eliminate redundancies and restructure workflows to increase efficiency and to accommodate increased business volume.
• Combine technologies—Combining similar technologies can help a company to achieve strategic advantages in your market.
• Reduce costs—Consolidation can improve your purchasing power and decrease costs as you negotiate better terms with vendors based on the need for more materials because of increased output.
• Market expansion—There is potential that combining companies will create an advantage in a particular market, or enter into a market that was not previously available to you.

During this phase, you’ll want to gather experts and people with M&A experience. You need people who are expert advisors in HR, IT, operations, legal, taxes, and finances to help you cover all your bases and to help the transition run smoothly.

All of this experience, expertise, and knowledge come together to ensure that closing the deal will continue to meet the goals and objectives you established during the strategy stage.

Integration

Integration brings another set of challenges because now two companies with two cultures need to figure out how best to work together.

You will need to put together an integration team to help the integration run smoothly. Members of this team should include:

• Senior executives to keep stakeholders informed about merger progress, to communicate the value of the merger, and to ease concerns about the company’s future.
• Due diligence team to retain important information. The due diligence team works with the integration team to ensure that all data is successfully transferred, that there are no redundancies, and that no information is lost.
• Human resources to communicate with and answer questions from employees about job positions, benefits, roles, and expectations going forward. 
• Change management experts to help the purchased company feel cared for, to drive employee morale, and to help employees and stakeholders buy in to the idea of being acquired. Change management experts can help to avoid problems.

Consider using existing org charts and drawing new charts as needed during the integration phase. Org charts can give you valuable information like where people are physically located, what teams they are assigned to, their specific roles and responsibilities, and who reports to whom. This information can give you insight as you plan for restructuring organizations, departments, and business units. It can also help you understand the human capital of the organization that was just purchased. 

Steps for the buyer in the M&A process

Following a step-by-step process is essential for successfully navigating your way through the complexities of M&A. Below we briefly discuss 10 steps that the purchasing companies typically use during the M&A process.

Step 1: Develop an acquisition strategy

This step falls within the strategy phase of the M&A lifecycle. It is essential that you know why you want to acquire a company and what you expect to gain from the merger.

Step 2: Set the M&A search criteria

Determine the criteria for searching for potential targets, such as location, industry, profit margins, customer base, and so on. 

Step 3: Search for potential acquisition targets

Use the search criteria you identified to look for and evaluate companies that may fit with the goals you want to achieve from acquiring the other company.

Step 4: Begin acquisition planning

Contact the companies that were found in your searches. Get more information to begin evaluating the potential value of a deal and to see how open the company is to M&A. 

Step 5: Perform valuation analysis

When you find a company that is interested, ask for financial, market, and other information that will help you to begin determining the company’s value as a standalone company and a potential acquisition target.

Step 6: Begin negotiations

Create some valuation models to give you enough information to make a reasonable offer. After the offer is made, negotiate terms and iron out details.

Step 7: Perform M&A due diligence

When the offer is accepted, your due diligence team starts an exhaustive process that works to confirm or correct the purchasing company’s assessment of the target company’s value. The team performs a detailed examination and analysis of the target company’s entire operations including finances, assets, liabilities, customers, employees, and so on.

Step 8: Draft a purchase and sale contract

If due diligence does not unearth any major problems or concerns, write up a final contract for the purchase by the acquirer and the sale by the target company. The contract defines the type of purchase agreement—asset purchase or share purchase. 

Step 9: Develop a financing strategy for the acquisition

Financial options have most likely already been explored, but at this step you need to work out the details after the purchase and sale contract is signed.

Step 10: Close the deal and begin acquisition integration

After the deal is closed, the management teams from both companies work together to integrate the two businesses into one as seamlessly as possible. Members of the HR team and change management experts work to make employees feel like they are all part of the same team. Use org charts to get a quick overview of company hierarchy to help with restructuring and reorganization.

Best M&A practices for the buyer

Because M&A is a complex process, you will need to pay attention to detail, remain focused, and be willing to compromise. Below are a few best practices to consider when you are on the buying side of the M&A.

Be diplomatic and sensitive with your offer —Don’t make this a hostile takeover. You should have done your homework and should have found the company that best fits your criteria. Your offer needs to be beneficial to you as well as to the company that is being purchased.

Put together a team of experienced leaders and advisors —Experience and strong leadership can help put all interested parties more at ease with the process. If your team doesn’t act like they know what they are doing, it will be harder to get buy-in from employees.

Culture fit should be top of mind —Keep in mind that there could be some pushback from the company being acquired if the company cultures clash. 

Be trustworthy —Be honest throughout the M&A process. The acquisition will fail if employees from the purchased company feel that the buyer is dishonest and untrustworthy. 

Communicate and be transparent —M&A is a stressful time for employees. Keep the lines of communication open to help alleviate fears and anxieties that could negatively impact productivity. Answer questions honestly and promptly.  

Develop a transition plan —Before the deal is closed and even before due diligence is completed, work on a transition plan. Work with HR and use org charts to evaluate employees to find the best fit for leadership positions and team assignments.

Steps for the seller in the M&A process

It’s possible that a purchasing company might have more experience in the M&A process than the selling company. However, the seller also plays a key role in the process and should not just sit back and let the buyer call all the shots. The following are a few steps for the seller to take to help with mergers and acquisitions.

Step 1: Define the strategy

Just like the buyer needs to know why they are looking to acquire a company, the seller should have a clear idea of why they want to sell. Know what the rationale is and what objectives you want to achieve from the sale. Identify the buyers, or the qualities you want in potential buyers, that would contribute to an ideal selling situation.

Step 2: Compile information

Put together a comprehensive informational kit to formally present your company’s products and services, technology, financial standing, and market positions to buyers.  

Step 3: Contact buyers

Whether a buyer reaches out to you or you reach out to potential buyers, be strategic and only talk to companies that will be a good fit. Contact more than one buyer, but don’t waste time with buyers who are unlikely to acquire your business. 

Step 4: Take bids

Ideally, after companies have talked to you and evaluated the informational materials you have put together, the offers will start coming in. You never want to take the first offer. Weigh all the offers to see which is the most beneficial for you and for the buyer.

Step 5: Meet and negotiate with interested bidders

Meet with the companies that are interested in purchasing your company to find out more about their intentions, what their needs are, and what they are proposing and offering. After you have looked at bids from the interested parties, start the negotiations. Refer to your defined strategy to help you narrow down to the best candidates. Remember that until the company is sold, it is still your company. Any promises made by either side are moot until negotiations are completed and the final agreement is signed.

Step 6: Draft an agreement

The buyer and the seller work together to draft a mutually beneficial deal. Once you enter into an exclusivity agreement, it means that you are locked into an agreement with the company that wants to acquire your company. At that point you can’t seek out other buyers or enter into negotiations with other entities.

Step 7: Facilitate buyer’s due diligence

The buyer will have to complete due diligence before the sale can be completed. It can take up to two months to complete due diligence. Help speed up the process by gathering all documentation ahead of time and stay in close contact with your buyer to help solve any problems and issues that may come up.

Step 8: Get final board agreement

When the due diligence process is completed and the buyer wants to go forward with the purchase, get final agreement from the board.

Step 9: Sign the agreement

When both companies have signed the final agreement, the company has been sold and has merged with or been acquired by the buyer.

Best M&A practices for the seller

Mergers and acquisitions can be a long and emotionally draining process. You will need to remain focused to ensure that you are getting the best deal. The following are a few tips and best practices you may want to consider during the process.

Don’t take the first offer —Unless it is your only offer, the first offer may not be the best offer. Even if it is the only offer, you are free to negotiate if you feel like the offer undervalues your business and technologies.

Bring more than one buyer to the table —This gives you a better opportunity to determine which company is a better fit. While the sale is about money, it’s not all about the money. You need to sell to the company that most closely aligns with your company’s values, culture, work ethic, and so on. 

Form a team of experienced leaders and advisors —Working with, and listening to, people who have experience in these types of business dealings can help you to make informed decisions. Don’t rely on analysis alone. Talk to experienced buyers and sellers and be open to the advice they give you.

Don’t ask too much or too little for the business —A really high or unrealistic price tag can stop negotiations before they begin. On the other hand, setting a price that is too low gives the impression that you don’t understand the worth of your business. Make sure you know what the company—including its technology, assets, and human resources—is worth.

The M&A process doesn’t happen overnight or even in a couple of weeks. It is a long, complex, and detailed process that requires patience, diplomacy, compassion, and compromise. The steps and best practices we’ve outlined can help you to remain focused, pay attention to detail, and get the deal done right.

How can you better prepare employees for an M&A? See our list of guidelines.

About Lucidchart

Lucidchart, a cloud-based intelligent diagramming application, is a core component of Lucid Software's Visual Collaboration Suite. This intuitive, cloud-based solution empowers teams to collaborate in real-time to build flowcharts, mockups, UML diagrams, customer journey maps, and more. Lucidchart propels teams forward to build the future faster. Lucid is proud to serve top businesses around the world, including customers such as Google, GE, and NBC Universal, and 99% of the Fortune 500. Lucid partners with industry leaders, including Google, Atlassian, and Microsoft. Since its founding, Lucid has received numerous awards for its products, business, and workplace culture. For more information, visit lucidchart.com.

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Business Plan for Buying an Existing Business

Published Oct.18, 2023

Updated Apr.19, 2024

By: Alex Silensky

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Buying an existing business is a great way to enter a new market, expand your product or service offerings, or leverage the seller’s existing customer base and brand recognition. However, before making an offer, you need a clear and realistic acquisition business plan for running and growing the business post-acquisition.

A business plan for buying an existing business is a document that outlines your vision, goals, strategies, and financial projections for the business you want to buy. It is similar to a regular business plan but also includes information about the seller’s business history, performance, strengths, weaknesses, opportunities, and threats. 

A business plan for buying an existing business via franchise business planning services helps you to:

• Evaluate the feasibility and profitability of the deal
• Negotiate the best price and terms with the seller
• Secure financing from lenders or investors
• Manage the transition and integration process smoothly

What to Include In an Acquisition Business Plan?

A business plan for purchasing an existing business should cover all the essential aspects of running and growing a business, such as:

• Executive summary
• Company overview
• Industry analysis
• Marketing plan
• Operations plan
• Organization and management
• Financial plan

Why Do You Need a Business Plan Sample for Buying an Existing Business?

A business plan sample can help you write a business plan for buying an existing business by providing a template and examples of how to structure and present your information. A business plan for buying an existing small business can also inspire you with ideas and insights on improving or innovating the existing business.

To help you get started with writing your acquisition business plan template for buying an existing business, we have created a sample based on buying a restaurant for you.

Executive Summary

We are XYZ Restaurant Group, a company that owns and operates several successful restaurants in New York City. We seek to acquire ABC Restaurant, a well-established and popular Italian restaurant in Brooklyn, New York.

For over two decades, ABC has been a mainstay in the community, earning devoted regulars and renown for top-notch cuisine and hospitality. This 100-seat eatery runs at full capacity for lunch and dinner daily. Raking in $1.2 million yearly with $150,000 left over after expenses, ABC shows no signs of slowing down after its longstanding prosperity.

ABC Restaurant is an excellent opportunity to expand our portfolio and enter a new market. We have identified several areas where we can add value and improve the performance of the restaurant, such as:

• Updating menu and dishes
• Enhancing online presence and marketing
• Renovating interior/exterior
• Hiring and training new staff

We estimate the total cost of acquiring and improving ABC will be $500,000. We project that ABC will generate an annual revenue of $1.5 million and a net profit of $200,000 in the first year after the acquisition and grow by 10% annually.

Company Overview

XYZ Restaurant Group owns and whips up several nifty eats-places in the Big Apple. We’re crackerjack at serving out first-rate delicious eats from all over the world, like Mexican, Thai, Indian, and Mediterranean. Folks rave about our mouthwatering chow, friendly service, cozy mood, and fair coin.

Our mission is to dish up a memorable dining experience that delights taste buds and beats hopes. Our vision is to become top cook in the USA, with a diverse and brainy bill of fare for different chowhounds. We value being the cat’s meow, passionate, upright, diverse, and keeping customers cheerful.

We aim to acquire ABC, a swell and popular Italian hub in Brooklyn. ABC has loyal eaters and a dynamite food and service name. We want to buy ABC because it has a potential for growth and bankroll.

Industry Analysis

The restaurant industry in the USA is a large and diverse sector that includes various types of establishments, such as full-service restaurants, fast-food restaurants, cafés, bars, and catering services. 

Here are some key stats regarding the restaurant industry in the USA:

• The food service industry might reach $997B in sales in 2023. (Source – National Restaurant Association )
• There are 749,404 restaurants in the United States as of 2023. (Source – Zippa )
• Between April 2022 and March 2023, new business openings in the restaurant industry increased by 10%. (Source – Yelp )
• The US restaurant industry shall grow at a CAGR of 10.2% in 2022 and 2023. 

Some of the key trends and drivers that influence the restaurant industry are:

• Consumer preferences
• Regulations

Our primary competitors in the Italian restaurant segment are:

• Strong brand recognition
• Diverse menu selection
• Provides good value
• Menu lacks innovation
• Food quality is inconsistent
• Customer service needs improvement
• Expensive menu prices
• Small capacity limits covers
• Relies heavily on its location

Marketing Plan

Our marketing plan for ABC is based on the following objectives:

• To increase the awareness and recognition of ABC.
• To attract new customers and retain existing customers.
• To increase the sales and profitability of ABC.

Our business plan for buying an established business consists of the following elements:

• Professionals
• Millennials
• Updating the menu and introducing new dishes
• Enhancing the online presence and marketing
• Renovating the interior and exterior
• Hiring and training new staff and implementing best practices
• Branding – Our brand name is simple, memorable, and distinctive. Our brand logo is a stylized letter A with a fork and knife on either side. Our brand slogan is “ABC: A Taste of Italy.” Our brand colors are red, white, and green, representing the colors of the Italian flag. Our brand voice is friendly, professional, and authentic.
• Offering discounts and coupons
• Implementing dynamic pricing
• Creating bundle deals
• Providing upselling and cross-selling opportunities
• Online – Search engines, social media, email, and blogs, online reviews, testimonials, and referrals
• Offline – Newspapers, magazines, radio, TV, billboards, print ads, radio spots, TV commercials, outdoor signs, flyers, brochures, and business cards
• Events – Trade shows, festivals, and community events via booths, banners, and samples to display using contests, games, and giveaways

Operations Plan

Our operations plan for ABC is based on the following objectives:

• To provide a safe, clean, and comfortable environment
• To deliver high-quality food and service
• To manage our resources and costs effectively

Our business plan for buying an existing company consists of the following elements:

• Location and Facilities – ABC operates at 123 Main Street, Brooklyn, New York. It is a prime location with high foot traffic, visibility, and accessibility. The restaurant occupies a 2,000-square-foot space, including a dining area, kitchen, storage room, restroom, and office. The dining hall has a capacity of 100 seats and can accommodate up to 150 customers at peak times.
• Food: We buy ingredients from XYZ Food Distributors, a local company specializing in Italian food products.
• Beverages: We buy our beverages from ABC Beverage Company, a national company that offers a wide range of alcoholic and non-alcoholic drinks.
• Other: We buy our other supplies from DEF Supply Store, a regional company that provides various supplies.
• Food Safety – Adhere to all FDA and DOHMH guidelines. Monitor and log temps, freshness. Train staff on protocol.
• Service Excellence – Follow XYZ standards for hiring, training, dress code, incentives, feedback. Address complaints ASAP.
• Performance Evaluation – Track KPIs (sales, costs, satisfaction, retention) with POS, software, spreadsheets. Hold regular reviews to improve.
• Business License from NYS Department of State
• Food Service License from DOHMH
• Liquor License from NYS Liquor Authority
• Health Inspection clearance from DOHMH
• Fire Inspection clearance from NYFD
• Workers’ Compensation Insurance
• Liability Insurance
• Sales Tax registration and remittance with NYS Taxation and Finance
• Passed inspections for health, sanitation, and fire safety standards
• Obtained all necessary permits, licenses, registrations, and insurance

Organization and Management

XYZ Group is a partnership between Alex Smith, Park Smith, and Mark Wood, who own 33.3% and oversee strategy, operations, and technology, respectively.

ABC is a subsidiary operated by the following staff:

• General Manager – Reports to Alex Smith, oversees daily strategic and operational planning services
• Chef – Reports to Park Smith, manages kitchen and food preparation
• Sous Chef – Assists the Chef ensures food quality
• Kitchen Staff – Report to Sous Chef, perform various kitchen duties
• Servers – Report to the General Manager, take orders, and serve customers
• Host – Reports to General Manager, greets and seats guests
• Bartender – Reports to General Manager, prepares and serves drinks
• Delivery Driver – Reports to Mark Wood, delivers orders to customers

We have an experienced, competent team at ABC with proper training, compensation, and a collaborative work culture to drive success. The organizational structure establishes clear roles and reporting lines.

Financial Plan

Our financial plan for ABC is based on the following objectives:

• To generate sufficient revenue and profit
• To maintain a positive cash flow
• To secure adequate funding

When buying an existing business, it’s important to determine how much operating capital you should plan for. Our financial plan consists of the following elements:

• Funding Sources
• Assumptions

Income Statement

• Balance Sheet
• Cash Flow Statement
• Ratio Analysis
• Break-Even Analysis

Get Expert Help with Your Acquisition Business Plan

As you can see, developing a comprehensive business plan for buying an existing business requires significant time and expertise across various areas like finance, operations, marketing, and more. That’s where our expert advisors at OGSCapital can help.

With over 15 years of experience in M&A, strategic planning, and business planning, OGSCapital has helped numerous clients acquire and integrate businesses successfully. Our business plan writers can conduct diligence, analyze the deal, create projections, and craft a winning plan tailored to you. If you’re still thinking about how to buy an existing business, partner with our seasoned advisors to maximize your chances of closing and profiting.

Frequently Asked Questions

What is acquisition in business plan.

Acquisition in a business plan is buying or merging with another company to achieve strategic or financial goals. Acquisition planning can help a company expand its market share, diversify its product portfolio, acquire new technologies or skills, or reduce competition.

How do you create an acquisition plan?

To create a business plan for buying an existing business, you must define your objectives, identify and evaluate targets, conduct due diligence for merger and acquisition , negotiate the deal, plan and execute the integration, and monitor the outcomes.

How do I prepare my business for acquisition?

To prepare your business for acquisition, you should improve your business value, know your valuation range, establish an advisory board and a transition team, clean up your financials and legal documents, and prepare a pitch deck and better buy side due diligence services .

What should be included in an acquisition plan?

A business plan for buying an existing business should include an executive summary, target description, market overview, sales and marketing, financial history and projections, transition plan, deal structure, and appendices/supporting documents.

OGSCapital’s team has assisted thousands of entrepreneurs with top-rate business plan development, consultancy and analysis. They’ve helped thousands of SME owners secure more than $1.5 billion in funding, and they can do the same for you.

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The Ultimate Guide to Acquiring a Company for Business Growth

“This is an important milestone for Facebook because it's the first time we've ever acquired a product and company with so many users. We don't plan on doing many more of these, if any at all.”

Mark Zuckerburg, Facebook CEO, Statement on acquiring Instagram.

Even for the most reluctant, the allure of deal making is often too strong to resist. When Facebook acquired Instagram in 2012, paying $1 billion for the then - nascent photo sharing app, he may genuinely have thought it was the last time he’d open the checkbook. But fast forward less than ten years later and his company has been involved in 50 further transactions, including a $19 billion acquisition of Whatsapp in 2014.

Facebook is not alone in its zeal for a deal: in the two decades since 2000, the Institute for Mergers, Acquisitions and Alliances (IMAA) estimates that, globally, there have been just short of 800,000 transactions with a value of approximately $57 trillion. And yet, by all accounts, around half of these deals will be poorly implemented, with managers neglecting to put in place a proper M&A integration framework.

At DealRoom we help many companies during M&A process and the steps which follow can be seen as a brief guide for acquiring a company.

Guide to Acquiring a Company

• Establishing a motive for the acquisition
• Create search criteria
• Research (access databases)
• Intro meetings
• Making an offer
• Due diligence

But let's start from the beginning.

When to Acquire a Company

• When strategic growth is your goal, acquiring a business makes logical sense. For instance, the Harvard Business Review notes that successful companies not only rely on acquisitions for growth, but also find that this route often comes with less cost and risk than other growth methods. 
• The business acquisition process must begin with a crystal clear strategic goal and specific criteria for evaluating potential targets. When you have both, you can seriously begin working to acquire a company. 
• When a target meets your strategic goal, and there are no red flags as you move through due diligence and begin to develop relationships with its stakeholders (here you must realize keeping an eye towards integration and change management/culture are essential), you can move forward with the process of acquiring a company. 
• Finally, you should not pursue the acquisition of a company when you are overly emotional or “ deal hungry. ” Specifically, do not let the lure of the chase and/or perceived fantasies about what the deal might yield be factors when you acquire a business. 

So, let's continue with steps in acquiring a business and company acquisition process.

How to Acquire a Company/Business (Steps)

1. establishing a motive for the acquisition.

Before acquiring a business and doing anything, there has to be a good ‘why'.

What motivates you to buy a company ? The overarching answer to the question is ‘because I want to grow the business', but you need to be more specific. Broadly speaking, the motives for buying a busines s fall into the following categories:

• Diversification
• R&D/Patents
• Transformation

Ask yourself which of these is the driver behind your motivation behind an acquisition. It could be a few of the reasons, but the likelihood is that if there are too many on the list, your thinking for the acquisition has become muddled.

This will only create problems down the line, potentially leading you to acquire the wrong business. Be honest about what you want and stick to it.

For a pinch of inspiration, see 11 powerful acquisition examples and what we learned from them.

2. Create search criteria

The search criteria are a natural extension from establishing a motive.

How much are you willing (and more importantly, able) to spend to acquire a business?

• Which markets should it be operating in?
• What kind of client base should it possess?
• What kind of synergies are you looking for, if any?

The more questions you ask about the company before you begin searching, the more efficient the search will be.

There’s room for some flexibility, but just as with the previous section, the more specific you can be, the better.

One word of warning - it’s most important to establish the financial criteria (how much you’re able to spend and the financial position of the target) before beginning.

There will invariably be a business just outside your price range which is more attractive than those within it. Maybe they have a bigger market share, a better range of products or a more engaging management team. The advice here is straightforward - if you can’t afford the business, don’t acquire it.

3. Research

Not unlike Zillow or Trulia in real estate, in the realm of M&A there are dozens of databases online where business owners and their bankers list businesses for sale.

The one most suitable to you will depend on the size and geography of your business. However, it’s generally useful to sign up for a few, allowing you to cast a wider net to find the right business.

The benefit of spending some time on these M&A databases, aside from helping you to find what you’re looking for, is that it enables you to compare what’s on the market and the range of prices being sought for businesses in your space.

4. Outreach

If you opt to contact a business you’ve found through an M&A database, you’ll generally speak with their banker first. This individual will act like a gatekeeper to the business, establishing your interest in the company before providing you with the company’s confidential details.

The standard procedure here is to ask you to sign an NDA before providing you with a detailed memorandum of the business and its past financial performance.

If, on the other hand, you’re looking to sound out a local business about a potential offer, they’re unlikely to be for sale online. In such cases, there is no right or wrong strategy.

You can ask your lawyer to check their willingness to discuss a potential takeover, or you can approach the owner of the business yourself, being as transparent about your motives as possible without compromising details of your company’s strategy.

5. Intro meetings

Beyond that first reach out, introduction meetings give you a chance to meet the owner of the target business and hopefully, build a report.

If you do end up acquiring their business, there is every chance that they can play a key role in the integration of the two businesses, so it’s in everyone’s interests to stay on good terms.

Also, use these meetings to feel out the company’s culture - what’s brought them to where they are, how their employees are rewarded, etc.

6. Making an Offer

If, having become well acquainted with the company, you still like what you see, it’s time to make an offer.

The offer should balance your own purchase criteria, market comparables (what kind of multiples of EBITDA are being sought in the market for similar companies) and what the owner has intimated they’d accept if it was offered.

This last aspect is important. Nobody likes being ‘low balled.’ In the worst cases, it can be taken as an insult if your valuation is way off that of the owner’s, and you risk alienating them for future deals.

If you sense that you’re both too distant in valuation expectations, be honest about it at the outset and avoid wasting everyone’s time.

7. Due Diligence

Assuming the owner accepts the non-binding offer, you can move onto the due diligence phase. Depending on the size of the company, the process of due diligence can take anywhere from three weeks to three months, but about four to six weeks is typical for SMEs.

This is your last chance to find skeletons in the closet of the business (if they exist), so don’t rush the process. Use it as an opportunity to become more intimately acquainted with how it operates, so that you can hit the ground running when the deal ultimately closes.

To help companies with due diligence, we put together a complete due diligence playbook that outlines each step of this process. Get a free trial now!

Closing the deal will require some assistance from your lawyer to put together the documents you require:

• operative transaction agreement such as stock purchase agreement
• legal opinions
• regulatory approvals
• evidence of third-party consents
• consideration such as stock or cash
• ancillary agreements
• binding offer
• terms of funds transfer

If you’ve reached this stage without any hiccups, the integration phase can begin in earnest. You can also download our post merger integration checklist here to help with integration.

How Long Does it Take to Acquire a Company

The steps and time involved with acquiring a company or merging two companies can vary greatly depending upon the specific deal and its size.

A general time range is approximately 6 months to a year (sometimes longer). This lengthy time frame includes planning and identifying targets, moving through diligence, and deal approval.

Of course, the deal can be closed, but integration and change management practices can take quite a bit more time.

How long it takes to acquire a company can also be dependent upon the following:

• The buy-side’s desire to close the deal quickly
• The sell-side’s ability to generate competition
• The size of the companies
• The involvement of M&A advisors and financial bankers (they tend to speed up the process)
• The preparation of both the buy-side and the sell-side (are checklists created, is key information readily available?)
• The ease of the technology and project management platforms used to communicate and share key information

The vast number of acquisitions every year (in excess of 30,000 in 2018) suggests that companies of every size all over the world place faith in M&A to deliver growth.

The companies that succeed in doing so, are the ones that most effectively implement the steps we have outlined above.

By putting in the groundwork and spending time to find a business which is a good fit with your own, there’s every reason to believe your acquisition can deliver significant growth.

Get your M&A process in order. Use DealRoom as a single source of truth and align your team.

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What Is a Merger?

How a merger works.

• Merger Types
• Merger FAQs

The Bottom Line

• Corporate Finance

Merger: Definition, How It Works With Types and Examples

• Mergers and Acquisitions (M&A): Types, Structures, Valuations
• Merger CURRENT ARTICLE
• Acquisition
• Why Do Companies Merge With or Acquire Other Companies?
• How M&A Can Affect a Company
• What's the Difference Between Mergers and Acquisitions?
• What You Should Know About Corporate Mergers
• Inorganic Growth
• Merger vs. Takeover
• Takeover Bid
• Hostile Takeover
• Hostile Takeovers vs. Friendly Takeovers
• What Are Some of the Top Hostile Takeovers of All Time?
• How Can a Company Resist a Hostile Takeover?
• Poison Pill
• Reverse Takeover
• Reverse Mergers: Advantages and Disadvantages
• Reverse Triangular Merger
• A Guide to Spotting a Reverse Merger
• How Does a Merger Affect Shareholders?
• How Company Stocks Move During an Acquisition
• What Happens to Call Options If a Company Is Bought?
• Stock-for-Stock Merger
• All Cash, All Stock Offer
• Acquisition Premium
• Exchange Ratio
• SEC Form S-4
• Special Purpose Acquisition Company (SPAC)
• Understanding Leveraged Buyout Scenarios
• Vertical Merger
• Horizontal Merger
• Conglomerate Merger
• Roll-Up Merger
• The Five Biggest Mergers in History
• The 5 Biggest Acquisitions in History
• 4 Cases When M&A Strategy Failed for the Acquirer

A merger is an agreement that unites two existing companies into one new company. There are several types of mergers and reasons companies complete mergers. Mergers and acquisitions (M&A) are commonly done to expand a company’s reach, expand into new segments, or gain market share . All of these are done to increase shareholder value . Often, during a merger, companies have a no-shop clause to prevent purchases or mergers by additional companies.

Key Takeaways

• Mergers are a way for companies to expand their reach, expand into new segments, or gain market share.
• A merger is the voluntary fusion of two companies on broadly equal terms into one new legal entity.
• The five major types of mergers are conglomerate, congeneric, market extension, horizontal, and vertical.

Investopedia / Joules Garcia

A merger is the voluntary fusion of two companies on broadly equal terms into one new legal entity. The firms that agree to merge are roughly equal in terms of size, customers, and scale of operations. For this reason, the term " merger of equals " is sometimes used. Acquisitions, unlike mergers , are generally not voluntary and involve one company actively purchasing another.

Mergers are most commonly done to gain market share, reduce operational costs, expand to new territories, unite common products, grow revenues, and increase profits—all of which should benefit the firms' shareholders. After a merger, shares of the new company are distributed to existing shareholders of both original businesses.

The total value of U.S. mergers and acquisitions for 2023 dropped to $1.33 trillion from $1.49 of the previous year.

Types of Mergers

There are various types of mergers, depending on the companies' goals. Companies in the technology, healthcare, retail, and financial sectors will frequently merge . Here are some of the most common types of mergers.

Conglomerate

This is a merger between two or more companies engaged in unrelated business activities. The firms may operate in different industries or different geographical regions. A pure conglomerate involves two firms that have nothing in common. A mixed conglomerate, on the other hand, takes place between organizations that, while operating in unrelated business activities, are actually trying to gain product or market extensions through the merger.

Companies with no overlapping factors will only merge if it makes sense from a shareholder wealth perspective, that is, if the companies can create synergy , which includes enhancing value, performance, and cost savings. A conglomerate merger was formed when The Walt Disney Company merged with the American Broadcasting Company (ABC) in 1995.

A congeneric merger is also known as a Product Extension merger. This type combines two or more companies operating in the same market or sector with overlapping factors, such as technology, marketing, production processes, and research and development (R&D) . A product extension merger is achieved when a new product line from one company is added to an existing product line of the other company. When two companies become one under a product extension, they can gain access to a larger group of consumers and, thus, a larger market share. An example of a congeneric merger is Citigroup's 1998 union with Travelers Insurance, two companies with complementing products.

Market Extension

This type of merger occurs between companies that sell the same products but compete in different markets. Companies that engage in a market extension merger seek to gain access to a bigger market and, thus, a bigger client base. For instance, to extend their markets, Eagle Bancshares and RBC Centura merged in 2002.

A merger is the voluntary fusion of two companies on broadly equal terms into a new legal entity.

A horizontal merger occurs between companies operating in the same industry. The merger is typically part of consolidation between two or more competitors offering the same products or services. Such mergers are common in industries with fewer firms, and the goal is to create a larger business with greater market share and economies of scale since competition among fewer companies tends to be higher. The 1998 merger of Daimler-Benz and Chrysler is considered a horizontal merger.

When two companies that produce parts or services for a product merger, the union is referred to as a vertical merger . A vertical merger occurs when two companies operating at different levels within the same industry's supply chain combine their operations. Such mergers are done to increase synergies achieved through cost reduction, which results from merging with one or more supply companies. One of the most well-known examples of a vertical merger occurred in 2000 when internet provider America Online (AOL) combined with media conglomerate Time Warner.

Examples of Mergers

Anheuser-Busch InBev ( BUD ) is an example of how mergers work and unite companies together. The company is the result of multiple mergers, consolidations, and market extensions in the beer market. The renamed company, Anheuser-Busch InBev, is the result of the mergers of three large international beverage companies—Interbrew (Belgium), Ambev (Brazil), and Anheuser-Busch (United States).

Ambev merged with Interbrew, uniting the world's third and fifth-largest brewers. When Ambev and Anheuser-Busch merged, it united the number one and two largest brewers in the world. This example represents both horizontal merger and market extension as it was an industry consolidation and extended the international reach of all the combined company's brands.

The largest mergers in history have totaled over $100 billion each. In 2000, Vodafone acquired Mannesmann, a transaction valued at $190 billion, to create the world's largest mobile telecommunications company. In 2000, AOL and Time Warner vertically merged in a $164 billion deal considered one of the biggest flops ever. In 2014, Verizon Communications bought out Vodafone's 45% stake in Vodafone Wireless, the value of which was $130 billion.

What Is a Horizontal Merger?

A horizontal merger is when competing companies merge—companies that sell the same products or services. The T-Mobile and Sprint merger is an example of a horizontal merger. Meanwhile, a vertical merger is a merger of companies with different products, such as the AT&T and Time Warner combination.

What Is an SPAC Merger?

A special-purpose acquisition company (SPAC) merger generally occurs when a publicly traded SPAC uses the public markets to raise capital to buy an operating company. The operating company merges with an SPAC and becomes a publicly-listed company.

What Is a Reverse Merger?

A reverse merger, also known as a reverse takeover (RTO) , is when a private company purchases a publicly traded company. For instance, the New York Stock Exchange (NYSE) completed a reverse merger with Archipelago Holdings in 2006.

Mergers occur when two or more companies combine to make one larger one. They are usually strategic in nature for one or both businesses, granting them both larger market share or other advantages.

Paul Weiss, Rifkind, Wharton & Garrison, LLP. " M&A at a Glance: 2023 Year-End Roundup ." Pages 1-2.

The Official Disney Fan Club. “ American Broadcasting Company .”

The Board of Governors of the Federal Reserve System. “ Federal Reserve Press Release, September 23, 1998: Order Approving Formation of a Bank Holding Company and Notice to Engage in Nonbanking Activities ." Page 1.

U.S. Securities and Exchange Commission. “ RBC Centura to Acquire Eagle Bancshares, Inc .”

Mercedes-Benz Group. “ 1995 – 2007: “World Corp.” Vision .”

U.S. Government Printing Office. “ AOL & Time Warner Merger .”

B. Rajesh Kumar. " Mergers and Acquisitions by Anheuser-Busch InBev ." Wealth Creation in the World’s Largest Mergers and Acquisitions , Pages 69–77. Springer, 2018.

Beverage Daily. " Interbrew Buys AmBev and Becomes World Number One ."

The New York Times. " Anheuser-Busch Agrees to Be Sold to InBev ."

Goldman Sachs. “ Vodafone Acquires Mannesmann in the Largest Acquisition in History .”

U.S. Securities and Exchange Commission. “ AOL, Inc., Schedule 14D-9, May 14, 2015 .”

Verizon. “ Verizon Completes Acquisition of Vodafone's 45 Percent Indirect Interest in Verizon Wireless .”

U.S. Securities and Exchange Commission. " New York Stock Exchange/Archipelago Holdings Merger Complete ."

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Press Release

September 22, 2021 4:45 pm

MoneyLion to Become Publicly Traded Following Completion of Business Combination with Fusion Acquisition Corp.

MoneyLion to Begin Trading Tomorrow on the NYSE Under Ticker Symbol “ML”

New York, NY, September 22, 2021 — MoneyLion Inc. (“MoneyLion”) an award-winning, data-driven, digital financial platform, announced today that it has closed its previously announced business combination with Fusion Acquisition Corp. (“Fusion”). The transaction was approved at a special meeting of Fusion’s stockholders on September 21, 2021.

The combined company will be renamed “MoneyLion Inc.” and will be led by its existing management team.   Its shares of Class A common stock and public warrants are expected to begin trading tomorrow, September 23, 2021, on the New York Stock Exchange (“NYSE”) under the ticker symbols “ML” and “ML.WS”, respectively.

“Today marks an incredible milestone for MoneyLion,” said Dee Choubey, co-founder and CEO of MoneyLion. “Taking this step to become a public company provides us with an incredibly strong balance sheet to accelerate our mission of using our digital financial platform to rewire the banking system and help more people take control of their finances and achieve their life goals.   We are grateful for the support from our global team, our investors and everyone who helped us reach this moment, and we are excited for the future ahead.”

John James, CEO of Fusion, commented: “The MoneyLion team has positioned the business extremely well for future scale, and this transaction provides them with ample growth capital to expand their already broad suite of products and services, both organically as well as through strategic acquisitions.   We look forward to partnering with Dee and his talented management team during their next phase of growth.”

MoneyLion’s new board of directors will be comprised of ten directors, nine of whom are independent directors as defined in the NYSE listing standards and applicable SEC rules. Led by non-executive Chairman John Chrystal, vice chairman of The Bancorp, Inc., MoneyLion’s directors include former Ambassador Dwight Bush Sr., Greg DePetris, fintech and securities industry veteran, Matt Derella, former global vice president of revenue and content partnerships at Twitter, Jeff Gary, CFO of Fusion, Lisa Gersh, co-founder of Oxygen Media, Annette Nazareth, former SEC Commissioner, Michael Paull, president of Disney+ and ESPN+, and Chris Sugden, managing partner, Edison Partners.

Citi, Broadhaven, and FT Partners acted as financial advisors to MoneyLion. Davis Polk & Wardwell LLP acted as legal advisor to MoneyLion.

J.P. Morgan Securities LLC served as exclusive financial advisor and lead placement agent to Fusion. Cantor Fitzgerald & Co. served as capital markets advisor to Fusion and White & Case LLP acted as legal advisor to Fusion. Citi, Cantor Fitzgerald & Co., and Odeon Capital Group, LLC also acted as co-placement agents on the PIPE.

About MoneyLion

MoneyLion is a mobile banking and financial membership platform that empowers people to take control of their finances. Since its launch in 2013, MoneyLion has engaged with over 8.5 million hard-working Americans and has earned its members’ trust by building a full-service digital platform to deliver mobile banking, lending, and investment solutions. From a single app, members can get a 360-degree snapshot of their financial lives and have access to personalized tips and tools to build and improve their credit and achieve everyday savings. MoneyLion is headquartered in New York City, with offices in Sioux Falls and Kuala Lumpur, Malaysia. MoneyLion has achieved various awards of recognition including the 2020 Forbes FinTech 50, Aite Group Best Digital Wealth Management Multiproduct Offering, Finovate Award for Best Digital Bank 2019, Benzinga FinTech Awards winner for Innovation in Personal Finance 2019 and the Webby Awards 2019 People’s Voice Award.

For more information about the company, please visit www.moneylion.com . For investor information and updates, visit www.moneylion.com/investors and follow @MoneyLionIR on Twitter.

About Fusion Acquisition Corp.

Fusion Acquisition Corp. is a special purpose acquisition company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses. Fusion was founded by and is led by CEO John James (who also stands behind the global fintech, BetaSmartz, as well as co-founding emerging opportunities investment company, Boka Group), and Chairman Jim Ross (senior advisor to State Street and former Chairman of State Street Global Advisors SPDR ETFs). For more information, visit fusionacq.com .

Forward-Looking Statements

This communication includes “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding MoneyLion’s expectations with respect to the impacts of the business combination with Fusion (the “Business Combination”) and the products and markets and expected future performance and market opportunities of MoneyLion. These statements are based on various assumptions, whether or not identified in this communication, and on the current expectations of MoneyLion’s and Fusion’s management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of MoneyLion and Fusion. These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the proposed Business Combination; risks relating to the uncertainty of the projected financial information with respect to MoneyLion; future global, regional or local economic and market conditions; the development, effects and enforcement of laws and regulations; MoneyLion’s ability to manage future growth; MoneyLion’s ability to develop new products and solutions, bring them to market in a timely manner, and make enhancements to its platform; the effects of competition on MoneyLion’s future business; the ability of the combined company to issue equity or equity-linked securities in the future; the outcome of any potential litigation, government and regulatory proceedings, investigations and inquiries; and those factors discussed in Fusion’s final prospectus dated June 25, 2020, Annual Report on Form 10-K/A for the fiscal period ended December 31, 2020 and registration statement on Form S-4, in each case, under the heading “Risk Factors,” and other documents of Fusion filed, or to be filed, with the Securities and Exchange Commission (“SEC”). If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that neither MoneyLion nor Fusion presently know or that MoneyLion and Fusion currently believe are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect MoneyLion’s and Fusion’s expectations, plans or forecasts of future events and views as of the date of this communication. MoneyLion and Fusion anticipate that subsequent events and developments will cause MoneyLion’s and Fusion’s assessments to change. However, while MoneyLion and Fusion may elect to update these forward-looking statements at some point in the future, MoneyLion and Fusion specifically disclaim any obligation to do so. These forward-looking statements should not be relied upon as representing MoneyLion’s and Fusion’s assessments as of any date subsequent to the date of this communication. Accordingly, undue reliance should not be placed upon the forward-looking statements.

MoneyLion Communications

[email protected]

Cody Slach, Alex Kovtun

Gateway Investor Relations

(949) 574-3860

For Investor Inquiries: [email protected]

For Media Inquiries: [email protected]

Merger Model Template: Elevate Your M&A Analysis

The Macabacus merger model implements advanced M&A, accounting, and tax concepts, and is intended for use in modeling live transactions (with some modification, of course). Advanced functionality includes multiple financing and capitalization scenarios, third-party financing, target debt repayment, asset or stock deal structure, IRC Section 338 elections, net operating losses and their limitation under IRC Section 382, and more. Given the complexity of this template, be sure you are comfortable with how to build an operating model and an M&A model .

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Inside the Macabacus Merger Model Template

Mergers and acquisitions are transformative events in a company’s lifecycle, and a comprehensive, accurate model is a pivotal part of these transactions. It helps in determining the deal’s feasibility, estimating the financial impact, and planning the post-merger integration. The Macabacus merger model offers a highly detailed and flexible framework for these analyses.

A few key functionalities in this M&A Excel template include:

• Multiple Financing and Capitalization Scenarios: This enables the user to simulate various scenarios based on different financing options and capital structures, aiding in the decision-making process.
• Third-Party Financing: The model can simulate scenarios where external financing is used for the transaction, providing a more accurate picture of the deal’s financial implications.
• Asset or Stock Deal Structure: This function allows the user to evaluate the financial impact of the deal, whether it’s structured as an asset purchase or a stock purchase.
• IRC Section 338 Elections: IRC Section 338 allows for a “step-up” in the basis of assets in a stock acquisition, which can result in future tax deductions. The model takes this into account in its calculations.
• Net Operating Losses (NOLs) and Limitation under IRC Section 382: The model includes functionality to model NOLs and their usage, limited under IRC Section 382 following an ownership change.

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Hypothetical Merger & Acquisition Example

Consider a hypothetical example where Company A is planning to acquire Company B. With the Macabacus merger model, the financial analysts at Company A can run multiple financing and capitalization scenarios, such as using internal cash reserves, raising debt, or issuing new equity. They can also simulate the impact of third-party financing on the company’s financials.

If Company B has substantial NOLs, the analysts can model the limitations on their usage under IRC Section 382 due to the ownership change. If the deal is structured as a stock acquisition, the analysts can model the impact of IRC Section 338 elections and estimate future tax savings due to the step-up in the basis of assets.

Scenario Analysis

One of the standout features of this M&A model template is its ability to handle multiple scenarios side by side. This feature is a powerful analytical tool, allowing you to compare the implications of different financial, operational, or strategic decisions within the context of the proposed merger or acquisition.

For instance, you can input varying financing strategies, capital structures, or deal structures, and the model will present the financial outcomes of each scenario in a comparative format. This might include differences in earnings per share, debt ratios, return on investment, or any other financial metrics that are crucial to your decision-making process. This ability to compare ‘what if’ scenarios side by side not only saves considerable time but also offers clarity, making it easier to evaluate the relative merits and potential risks associated with each option.

The side-by-side comparison feature enables strategic planning with a data-driven approach. It ensures that decisions aren’t based on single-point estimates but rather consider a range of possible outcomes. By exploring multiple scenarios, you can better anticipate potential challenges, adjust your strategies proactively, and thereby increase the likelihood of a successful transaction.

Unlock M&A Insights with the Merger Model Template

Despite its advanced functionalities, this merger template should be adapted to the specific transaction at hand. It is an invaluable tool for financial analysts and investment bankers in the complex, high-stakes world of M&A transactions. Its effective utilization requires a strong understanding of operating and M&A models, as well as the intricate dynamics of the merger process. However, with this knowledge and the right model at their disposal, professionals can unlock new levels of insight and precision in their analysis.

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• MANAGEMENT ACCOUNTING

Mastering accounting for business combinations

Mergers and acquisitions present challenges that finance can overcome by staying involved with the deal and preparing in advance of the closing..

• Management Accounting
• Accounting & Reporting
• FASB Financial Accounting & Reporting
• Managerial Financial Accounting & Reporting

When accountants face the prospect of a business combination, there will be many challenges to prepare for in the deal and the accounting for it.

One of the first challenges is the strategic decision - making about whether the deal is right from a business perspective.

"Statistically, acquisitions aren't successful a high percentage of the time," said Aaron Saito, CPA, CGMA, Capital Accounting controller at Intel Corp. "It's like a baseball batting average, where .300 to .400 is outstanding. If you're at this percentage for M&A, you're beating the average," he said.

There are deal activities usually led by those outside of finance, such as finding the right target, performing due diligence, setting the price, drafting a purchase agreement, and working with professionals to close the transaction.

"Much of the complexity in acquisitions results from stresses around negotiating the deal structure, like funding arrangements, tax considerations, and continuation or dismissal of the acquired entity's employees," said Susan Callahan, CPA, Ford Motor Co.'s director, Americas Accounting and Global Policy. "These are in addition to the technical complexity of financial reporting."

FASB' s RULES

FASB ASC Topic 805, Business Combinations , is a specialized accounting area that has evolved over the years and continues to be the subject of simplification initiatives by FASB. It is complex and may require CPAs to face new issues and apply certain accounting principles for the first time (see the sidebar, "Accounting Quick Tips," below).

"Unless you work for a company that is a serial acquirer, you are not applying acquisition accounting day to day, like you are other GAAP areas like revenue recognition and inventory accounting," said Greg McGahan, CPA, a partner at PwC. "Most companies only do one acquisition every couple of years, as it is only one path of a company's growth agenda. You may have to crack the books open and deal with a new accounting model, to refresh what you remember but also to keep up with the changes," he said.

To help accountants better anticipate and prepare for the challenges in business combinations, here are some things to consider.

INVOLVEMENT WITH THE DEAL

Since finance may not be leading the acquisition process, it is critical that it has a seat at the table and a strong partnership with the business development team throughout the transaction life cycle. In that way, finance will understand the deal's rationale, critical contract terms, and where the value drivers are.

"In a typical case, the business development group has done their due diligence, analyzed the target, developed the price, and determined the value drivers. Then the deal is closed, and the torch is passed to finance to do the acquisition accounting," McGahan said.

He said that if there is a lack of communication with the deal team, and finance doesn't understand the value drivers — such as a business that was acquired for a customer list or a platform that was too difficult to build internally — it will be much harder to apply acquisition accounting and properly value assets acquired and liabilities assumed.

Saito agreed that it is very important to understand the accounting ramifications upfront. "Once the ink is dry on the contract, you don't have options," he said. "And it's not easy to read purchase contracts. They can be 400 to 500 pages long, so it's easy for even the best accountants to miss something."

Finance needs to ensure that it does not get left out of the due - diligence process, because it can add value to the negotiations and help determine the best accounting and tax outcomes.

"Being part of due diligence can help finance understand the business being acquired and uncover areas where things can go wrong. Otherwise, you may not know what you don't know," said Linnae Latessa, CPA, corporate controller and chief accounting officer of USI Insurance Services.

Finance can reduce risks and avoid surprises by advising the due - diligence team against doing things in the transaction based on the potential financial impacts post - close , Saito said.

UNDERSTANDING GAAP

Accounting for business combinations is complex and requires considering a number of areas, including the following:

• Identifying business combination transactions.
• Identifying the acquirer.
• Determining the acquisition date.
• Measuring the consideration transferred.
• Recognizing and measuring the identifiable assets acquired and liabilities assumed, and any noncontrolling interests in the acquiree.
• Recognizing and measuring goodwill for a gain from a bargain purchase.

Topic 805 provides guidance on the accounting and reporting for business combinations to be accounted for under the transition method.

One of the biggest challenges in applying acquisition accounting is the requirement to estimate the fair value of assets acquired and liabilities assumed. Valuation is challenging and requires a lot of judgment, which needs to be supported. Irrespective of whether the valuation is performed internally within a company or by an outside third party, finance needs to be aware of fair value accounting requirements and involved in the valuation process.

"Fair value using the concept of what 'market participants' do in arm's - length transactions may be a foreign concept," said Saito. Also, things may need to go on the balance sheet that were never valued before, like internally developed intangibles, intellectual property, know - how , and brands.

Valuation is frequently based on cash flow models. "Does the company have cash flow models? If so, how do you adjust them to reflect market participant assumptions? Where are the cash flows associated with the valuation? How do you translate deal price of '10X EBITDA' into cash flows?" asked Saito.

Some companies may perform the valuation themselves internally. If they do, it is important for finance to have the necessary expertise and to work with the external auditors to make sure the documentation and support that finance develops for the acquisition accounting is adequate for the auditors' needs.

Many companies use third - party valuation firms for their fair value estimates. Latessa recommended that transactions over a determined dollar value have an outside valuation. If a third - party valuation firm is used, management must be comfortable with the outcome of its activities.

"The valuation firm works from the assumptions the company provides, such as revenues used to value trademarks, and specific customer revenues and attrition rates to value customer intangibles," said McGahan. "At the end of the day, the financial statements are the company's responsibility. Mistakes in valuation in the financial statements are on your watch."

McGahan also advised that successful companies have an integrated approach to the valuation process, which includes the business development team and finance. The valuation experts should be given the deal's model assumptions (discount rates, internal rate of return, hurdle rates, and cost of capital) and the final version of the deal model to use, and everyone on the team should review the valuation output for reasonableness.

"Work with a good quality valuation firm, ask a lot of questions, and understand how they come up with the values," Latessa said. "They know how to run models, but conceptually does the answer make sense? Should 50% of the deal value have gone to the customer list? They should be able to explain why it makes sense."

The amount attributed to goodwill should also be reasonable in relation to the purchase price.

"It's the residual, but accountants should be able to validate it," McGahan said. "If 40% of the purchase price is allocated to goodwill, does that make sense based on the deal or value drivers? Things like future customers, platform, and company - specific synergies all go to goodwill."

This approach will pay dividends in the end, especially since valuation is an area of high audit concern. Because of the prevalence of merger activity in recent years and the many subjective judgments and estimates involved in the business combination process, the PCAOB highlighted its concern about valuation risk in its August 2017 Staff Inspection Brief. The PCAOB also recently issued two new standards that affect auditing of valuations: Amendments to Auditing Standards for Auditor's Use of the Work of Specialists and Auditing Accounting Estimates, Including Fair Value Measurements, and Amendments to PCAOB Auditing Standards .

CHANGES TO GAAP

The fair value challenges aren't the only things that make business combination accounting complex. FASB is continuing to work on initiatives to simplify this area and improve comparability. In 2017, FASB issued guidance that clarified the definition of a business. FASB also has several projects on its agenda that may impact business combinations, including subsequent accounting for goodwill and accounting for certain identifiable intangible assets, as well as improving the accounting for business and asset acquisitions. The experts interviewed for this article all agreed that these efforts have been helpful and made things better operationally.

FASB has also developed private company alternatives related to accounting for business combinations (see " Private Company GAAP Alternatives: It's Not Too Late ," page 32). However, the practical expedients for private companies should be used only if the company's financial statements stay in the private domain and the banks will accept this format. McGahan advised: "Most companies doing acquisitions will need to access capital markets to raise money, so financial statements may need to be SEC - compliant ."

Financial statement disclosures for business combinations can be extensive, especially for larger transactions.

"The critical assumptions regarding opening day balance sheet values are important for financial statement users," said McGahan. "They need transparent disclosure of significant acquisition accounting assumptions and estimates that are not [derived based on] observable inputs, including how they were developed."

For SEC registrants, operating segments may change based on how the new business will be managed going forward. In addition to the financial statements, there are also management's discussion and analysis (MD&A) and description of business sections to develop and prepare within filing deadlines.

Latessa recommended that accountants look at disclosures of other companies that have done acquisitions, along with networking with peers and others in their network or industry to ask if they have had the same issues that may need to be disclosed. She also recommended getting the auditors comfortable with disclosures in advance, getting their guidance on the requirements, and asking them what their other clients have disclosed in specific situations.

AFTER THE TRANSACTION CLOSES

After the business combination closes, accountants must contend with financial reporting challenges. "You can't just mush the results of the target in with the existing business," said Saito. " Post - close , it's disruptive."

Hopefully, there have been operational discussions in advance about how the new business will be managed, whether as a stand - alone or integrated business. "There may also be challenges with 'operationalizing' the acquisition accounting after day one," McGahan said, "like whether to track acquisition accounting at the parent or push down to a subsidiary, and how to deal with international transactions' foreign currency and deferred tax issues."

The closing process may become very challenging. Accounting policies and practices may be different and may have to be conformed. This may be an opportunity to evaluate existing accounting methods and make changes. There can also be timing issues if the acquired company takes longer to close its books.

If there are different ledgers and enterprise resource planning systems, automatic consolidation may not be possible and manual processes may have to be used. There will likely be system integration issues, especially if the acquired company is smaller and uses QuickBooks. System conversions will require additional reconciliations and verification of data. McGahan recommended that companies' due diligence include IT due diligence upfront to understand the target's IT and financial reporting and plan for it. "The best companies have dedicated teams to integrate IT post - closing to get the target on the same systems," he said.

"The two companies' accounting and finance departments need to form a partnership," said Saito. "Workflows may need to change, and change doesn't happen overnight."

Latessa agreed. "You may need to retrain the acquired company's people," she said. "This results in operational risks that can manifest themselves in the financial statements, so you need to be diligent in reviewing the financial statements when there are new employees involved." She has also experienced situations where the finance staff did not transfer to the acquiring company, so legacy knowledge and experience were lost. She said that in cases where a company buys a portion of another company, the acquired company's accounting may have been done at the corporate level, and it can take six months to a year for the acquirer to understand the business it bought.

Since post - close accounting is difficult, GAAP allows up to a year post - acquisition to finalize acquisition accounting and measurement period adjustments. But in some cases, there may only be 30 to 60 days to do a working capital true - up .

"The further away from the close date it is, the harder it is to remember, and people get busy with other things," Saito said.

Material adjustments to the acquisition accounting made too late can be considered errors as well as deficiencies of internal controls that could require financial reporting disclosure. Saito suggested that acquisition accounting be run like a project, with finance as the project manager, providing all involved departments a calendar of key dates and activities up to the earnings release so that everyone is aware of what has to be done and who has to review it.

Beyond the book close, reporting needs to be in place, including metrics and dashboards for management about the acquired business. A cash flow process should be developed to support the business after the close.

This requires planning in advance. "CFOs and boards of directors do not like surprises," Saito said. "Management needs to be aligned with finance upfront about what to expect."

INTERNAL CONTROLS

To address the issues related to business combinations, it is critical that companies implement internal controls over the integration process. "From my experience, the post - combination accounting is less an issue than is the integration of the acquired entity. Challenges associated with integrating a new company are often dependent on size and scale, but the acquirer may need to consider new systems, processes, and, most importantly, controls," Callahan said.

Another big challenge relates to the controls over the business combination process itself, especially in a company where this may not happen often.

"How robust your process is depends on the frequency of acquisitions. The harder part is that if they are infrequent, you may not know what you should be looking for," Saito said.

McGahan agreed: "Companies have spent their time and effort to develop controls around ongoing daily processes but may not have robust controls for business combinations and struggle with what these are. There is a set of specific controls and procedures that should be in place ... But companies don't spend sufficient time developing these if they are only doing a few transactions."

Post - acquisition , until there is one integrated process with combined controls, companies may struggle to comply with internal control frameworks and Sarbanes - Oxley (SOX) requirements.

"You will have to do more to get your auditors through their test work," Latessa said. "There may be extra work and cost for them to look at both companies' processes, sample sizes will likely be higher, and they will have to do more substantive work."

Under SOX Section 404, public companies must include an internal control report with management's assertions about the effectiveness of the company's internal control over financial reporting, and their auditors must attest to its effectiveness. There are SOX implications relating to the acquirer's internal controls over the acquisition accounting and financial statement consolidation processes, along with the acquired company's own internal controls over financial reporting. If it is not possible for the acquiring company to complete its assessment of internal control over financial reporting of the acquired entity between the acquisition date and the acquirer's year end, in order to assess and report on its own internal controls over financial reporting on a consolidated basis under SOX Section 404(b), there is a relief period of one year from the date of the acquisition during which it may exclude the acquisition from its assessment. Despite this relief, necessary controls should be designed and implemented as quickly as possible.

Another internal control issue is documentation. "If I think about controls that need to be in place, in my experience, substantively companies are doing the work that they need to do. They are not doing big transactions blindly, they have talked to their boards, and management time has been spent," ­McGahan said. "They do have support for what they've done, but they don't have the documentation all in one place. One of the biggest challenges auditors have is that companies have to go back and pull together documentation around what they've done so that auditors are able to reperform the control."

A company that is doing a material acquisition may wish to talk to its auditors in advance about what controls might be needed, Saito suggested. "This helps with the audit and also gets management comfortable that they have the right controls in place," he said. "No one wants to have an internal control issue down the line."

Accounting quick tips

These simple ideas can aid in M&A reporting. The following general advice can help organizations skillfully handle business combination accounting:

• “Plan, plan, plan,” and communicate upfront and throughout.
• Be proactive rather than reactive. You will have more time to think about, prioritize, and address the issues.
• Finance should be involved in the deal from the beginning and play a key role throughout the process to reduce surprises.
• Timelines and deadlines should be set for the integration of processes and people.
• Experience helps. As you go through more of these transactions, everyone on the team will be better educated about what finance needs to do.
• Reach out to your auditors as a resource, even if you are only thinking about doing a transaction, and be transparent with them if you do.
• Early in the process involve valuation specialists (whether internal or external) who will value assets acquired and liabilities assumed.

About the author

Maria L. Murphy, CPA , is a freelance writer based in North Carolina.

To comment on this article or to suggest an idea for another article, contact Ken Tysiac, the JofA 's editorial director, at [email protected] or 919-402-2112.

AICPA resources

• " After the Merger: Creating a Culture of Success ," JofA , Dec. 2018
• " Not-for-Profits Teaming Up to Fulfill Missions ," JofA , Nov. 2018
• " Tax Compliance After M&As ," JofA , Dec. 2017

Publication

Editor's note: The AICPA is developing a Business Combinations accounting and valuation guide that is expected to be released for feedback in 2020.

CPE self-study

• Advanced Income Tax Accounting — Tax Staff Essentials (#157834, online access)
• CEIV for Finance Professionals: CEIV Education and CEIV Exam (#158530-CEIVLQN, education bundle; #16-XAM-CEIVLQN, CEIV exam). The Certified in Entity and Intangible Valuations (CEIV) credential program is designed to enhance credential holders' commitment to enhancing audit quality, consistency, and transparency in fair value measurements for financial reporting purposes.

For more information or to make a purchase, go to aicpastore.com or call the Institute at 888-777-7077.

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Service Fusion Acquired by EverCommerce

Vista Point Advisors is pleased to announce the acquisition of Service Fusion by EverCommerce. Vista Point Advisors acted as the exclusive financial advisor to Service Fusion.

About Service Fusion

Service Fusion is a leading provider of software for Field Service customers, including HVAC/refrigeration, plumbing, electrical, appliance repair, garage door, equipment repair, and security businesses. The company serves over 4,000 customers across the US and Canada. Service Fusion is headquartered in Dallas, TX with over 75 employees.

About EverCommerce

EverCommerce is the leading service commerce platform, connecting best-of-breed marketing, business management, and customer retention technology solutions for more than 200,000 service sector organizations across the globe. Born from the leadership team of successful software start-ups, renowned private equity firms, and Fortune 500 enterprises, EverCommerce provides comprehensive solutions for businesses in the high-growth Home & Field Service, Health Service, and Fitness & Wellness industries. EverCommerce clients are able to attract customers at scale, provide services efficiently, act on business insights, and increase customer loyalty and value.

About Vista Point Advisors :

Vista Point Advisors is a boutique investment bank that focuses on advising founder-led companies in the Software and Internet industries. Our strategy is to partner with growing and profitable businesses that are interested in understanding their options in the marketplace. We focus exclusively on sell-side M&A and capital raising transactions. Vista Point Advisors is headquartered in San Francisco, California.

Acquisition of Fusion Pharmaceuticals Completed

News provided by

Jun 04, 2024, 16:05 ET

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HAMILTON , ON and BOSTON , June 4, 2024 /PRNewswire/ -- Fusion Pharmaceuticals Inc. (Nasdaq: FUSN ), a clinical-stage oncology company focused on developing next-generation radioconjugates (RCs), announced the successful completion of the acquisition of all of the issued and outstanding shares of Fusion by a wholly-owned subsidiary of AstraZeneca AB by way of a statutory plan of arrangement under section 192 of the Canada Business Corporations Act , referred to as the Arrangement. The Arrangement marks a major step forward in AstraZeneca delivering on its ambition to transform cancer treatment and outcomes for patients by replacing traditional regimens like chemotherapy and radiotherapy with more targeted treatments.

The Arrangement complements AstraZeneca's leading oncology portfolio with the addition of the Fusion pipeline of RCs, including their most advanced program, FPI-2265, a potential new treatment for patients with metastatic castration-resistant prostate cancer (mCRPC), and brings new expertise and pioneering R&D, manufacturing and supply chain capabilities in actinium-based RCs to AstraZeneca. The Arrangement is also expected to strengthen AstraZeneca's presence in and commitment to Canada .

As a result of the Arrangement, Fusion has become a wholly owned subsidiary of AstraZeneca, with operations continuing in Canada and the US. Fusion shares will be delisted from the Nasdaq Stock Market and deregistered under the U.S. Securities Exchange Act of 1934. Fusion has submitted an application to cease to be a reporting issuer under applicable Canadian securities laws and to otherwise terminate Fusion's Canadian public reporting requirements.

Financial Considerations Under the terms of the definitive agreement, AstraZeneca, through a subsidiary, has acquired all of Fusion's outstanding shares pursuant to the Arrangement for a price of $21.00 per share in cash at closing plus a non-transferable contingent value right of $3.00 per share in cash payable upon the achievement of a specified regulatory milestone prior to August 31, 2029 . Combined, the upfront payment and maximum potential contingent value payment, if achieved, represent a transaction value of approximately $2.4 billion . As part of the Arrangement, AstraZeneca acquired the cash, cash equivalents and short-term investments on Fusion's balance sheet, which totaled $211 million as of March 31 , 2024. 

The upfront consideration has been provided to Equiniti Trust Company, LLC, as depositary under the Arrangement, and, along with the contingent value rights, will be delivered to former securityholders (as applicable) of Fusion as soon as practicable on or after the date hereof.

About Fusion Fusion Pharmaceuticals is a clinical-stage oncology company focused on developing next-generation RCs. Fusion connects alpha particle emitting isotopes to various targeting molecules in order to selectively deliver the alpha emitting payloads to tumors. Fusion's clinical-stage development portfolio includes lead program, FPI-2265, targeting PSMA for mCRPC and novel RCs targeting solid tumors. Fusion has a fully operational Good Manufacturing Practice compliant state-of-the-art radiopharmaceutical manufacturing facility to meet supply demand for Fusion's growing pipeline of radioconjugates.

Forward Looking Information To the extent any statements made in this communication contain information that is not historical, these statements are forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, and forward-looking information under Canadian securities law (collectively, "forward-looking statements"). Certain statements in this communication may constitute forward-looking statements, which reflect the expectations of Fusion's management. The use of words such as "may," "will," "could," "should," "expects," "intends," "plans," "anticipates," "believes," "estimates," "predicts," "projects," "seeks," "endeavor," "potential," "continue" or the negative of such words or other similar expressions can be used to identify forward-looking statements. 

Fusion's actual results could differ materially from those stated or implied in forward-looking statements due to a number of factors including but not limited to risks related to the ability of Fusion to meet the regulatory milestone, the response of business partners and competitors to the completion of the Arrangement, and/or potential difficulties in employee retention as a result of the Arrangement; and  the failure to realize the expected benefits of the Arrangement. Please also refer to the factors discussed under "Risk Factors" and "Special Note Regarding Forward-looking Information" in Fusion's Annual Report on Form 10-K for the year ended December 31, 2023 , with the U.S. Securities Exchange Commission ("SEC"), each as updated by Fusion's continuous disclosure filings, and the factors discussed under "Risk Factors" in the Management Information Circular and Proxy Statement dated April 25, 2024 , all of which are available at www.sec.gov and at www.sedarplus.ca .

Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at or by which such performance or results will be achieved. All forward-looking statements herein are qualified in their entirety by its cautionary statement and are made as of the date of this document. Fusion disclaims any obligation to revise or update any such forward-looking statements or to publicly announce the result of any revisions to any of the forward-looking statements contained herein to reflect future results, events or developments, except as required by law.

Radioconjugates in oncology RCs combine the precise targeting of antibodies, small molecules or peptides with potent medical radioisotopes to deliver radiation directly to cancer cells. By seeking out cancer cells, RCs provide a more precise mechanism of cancer cell killing compared with traditional radiation therapy, with the goal of improving efficacy while minimizing toxicity on healthy cells. RCs are administered via systemic delivery, which enables their use in tumour types not accessible to external beam radiation and the targeting of cancer cells that have spread from the main tumour to other sites in the body.

About FPI-2265 FPI-2265 is an actinium-225 based PSMA-targeting RC for mCRPC, currently in a Phase II trial.

Actinium-225 emits alpha particles and holds the promise of being a next-generation radioisotope in cancer treatment. By delivering a greater radiation dose over a shorter distance, alpha particles such as actinium-225 have the potential for more potent cancer cell killing, and targeted delivery, thereby minimizing damage to surrounding healthy tissue.

For further information: Amanda Cray , Senior Director of Investor Relations & Corporate Communications, 617-967-0207, [email protected]

SOURCE Fusion Pharmaceuticals

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