Explain a target acquisition through a clear strategic deal thesis before discussing valuation.
The move: price follows thesis, not the other way around. A basic M&A review should start with the strategic reason for ownership. Porter's Five Forces gives you five places to look: rivalry, buyer power, supplier power, substitutes, and barriers to entry. A target is attractive when ownership changes one or more of those forces in a way the acquirer can capture. Strategic pressure Name the pressure first. Are customers gaining bargaining power? Are substitutes making the core product less defensible? Are suppliers capturing too much margin? Without this, the target becomes a collection of nice facts rather than a strategic…
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