The cost of capital is low and your company made it through the recession. Now may seem like a good time to buy but you're scared off by the high business mergers and acquisitions failure rate. Recent results project an upward trend in success. While the science of predicting the success of mergers and acquisitions as well as initial public offerings may seem hypothetical, there seem to be factors that hinder or help the process.

Budgets and people don't integrate themselves. Before the deal closes, it's important to have a detailed integration plan that covers all facets of the organization. Moreover, first steps towards integration should be taken before the ink dries. Combining synergies on paper is easier than doing so in practice, but cultivating and maintaining processes should smooth the transition.

Target Sighting and Metrics
M&A's with synergy targets and metrics in place have a better chance at succeeding. Collecting, analyzing, and presenting data on a regular basis lets the board know if the unit is growing according to plan or if actions need to be taken to correct missteps, should growth plateau or slow.

Maintaining Business Intelligence
Loss of key people has a definite impact on the future performance of the merged entity. It's important that new organizational structure and leadership is set early in the integration process to prevent business intelligence from literally walking out the door.

Protect your Base Business
While it's important to have a smooth transition process, getting work done should still be top priority. Management shouldn't be distracted by M&A activity. They should be vigilant against competitors who may try to take advantage of the flurry of activity and present a unified front to customers despite gaps in the integration.

Lack of Due Diligence
Performing proper due diligence can unearth factors such as pending law suits, outstanding tax debt, and extreme vulnerability to litigation that can dissuade a potential buyer. A thorough background check can protect your base business and can save you time and money.

Relative Size
A significant difference in size between the acquiring and target company has been found to be a factor in poor acquisition performance. M&A can flounder if the divested company is too large to manage or if smaller acquisitions don't receive the time and attention they required.

Corporate Culture Differences
Differences within corporate culture are another factor that can hamper the chance for success. When a company is acquired, the decision is typically based on product or market synergies, "soft factors" that can be overlooked with the assumption that personnel issues can be overcome. While cherished aspects of a work environment may seem petty compared to the bottom line, their removal may result in resentment, productivity decrease and loss of key employees.

Business Merger and Acquisition Experience
While previous M&A experience is not a necessary requirement for success, it does help when detecting red flags and creating and implementing a better integration plan. If this is your first M&A, seek the advice of expertise of knowledgeable professionals. Corporate finance consulting, accounting, treasury and related professionals will provide a wealth of expert advice and information that will help make your merger a successful one.