7 reasons why smart companies Amazon, Nike, Target do M&A
Businesses are competing harder than ever to attract and retain customers. Strategic buyers are pursuing acquisitions aggressively to gain new technologies, increase their offerings and expand their customer bases.
“Strategics have been really active,” says John Neuner, Harris Williams managing director. “They are aggressive in pursuing the assets they want, as long as it fits within their strategy. Scale is critical to them and they have to meet consumer demands by adding new capabilities.”
“Capital is at the ready and will continue to be deployed in 2019 to acquire new brands, scale and technologies that facilitate growth and enhance perceived value to the customer experience,” says John Potter, U.S. consumer markets deals leader at PwC, in the firm’s Q4 Consumer Markets Deal Insights Report.
Technology plays a key role in many transactions. But while technology is enabling developments, it’s not an end unto itself for many corporations. Instead, strategic buyers are using innovations as a means to achieve goals, such as improving the customer experience.
For example, Target paid $550 million for Shipt in 2017. The deal will help Target deliver everyday items, such as groceries, straight to customers’ doors.
Customers want more convience when it comes to mobile payments, and that is another M&A driver. Grubhub is buying restaurant payments processor LevelUp.
Here are 7 outcomes strategic buyers hope to achieve through today’s M&A deals.