What is M&A (Mergers & Acquisitions)?

M&A is a critical topic in both consulting and investment banking interviews. When evaluating an acquisition, you should assess: strategic rationale (why this target?), valuation (what is a fair price?), synergies (what value can be created post-deal?), integration risks (cultural fit, systems compatibility), and financing (how will the deal be funded?).

The strategic rationale typically falls into categories: horizontal M&A (acquiring a competitor for scale), vertical M&A (acquiring a supplier or distributor for control), and conglomerate M&A (diversifying into unrelated businesses). Each type has different synergy profiles and antitrust implications.

Post-merger integration is where most M&A value is won or lost. Studies consistently show that 50-70% of mergers fail to deliver expected synergies, often due to cultural clashes, customer attrition, or key talent departures. In case interviews, demonstrating awareness of integration challenges shows maturity beyond just the deal rationale.