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Evaluating M&A through the supply chain lens

In this article in CFO Magazine, Kai Trepte looks at how to apply certain supply chain evaluation methods to potential M&A deals. He takes the example of General Electric and Baker Hughes, whose oil & gas businesses are currently undergoing a merger. Trepte explains that, by applying standard supply chain calculations to financial statements, it's possible to assess the uncertainties surrounding a company’s top-line revenue, gross margin, and inventory. He writes: “The goal is to understand whether the combined entity increases uncertainty.”

He adds: “The larger benefit of the supply chain lens from acquirer or investor perspectives is that it provides focus and support for added due diligence efforts.”

To read more on this article, click here.

CTMfile take: For companies undergoing M&A, this is an interesting perspective to consider.

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