The dissertation’s subject matter is mergers and acquisitions (“M&A”). The reason standing behind the dissertation is the ever growing number of announced M&A transactions around the world. The research shows why M&A are important for the company management and why managers today see them as one of the greatest challenges. The work includes a chapter dedicated to the history of M&A and its current state, which has been affected by the financial crisis. One of the main objectives of the dissertation is to connect the economic and legal views on M&A. The work confronts theoretical knowledge with actual M&A cases. In order to provide a clearer understanding of M&A, cases of both successful and unsuccessful M&A transactions in various industries are described. The dissertation includes a detailed description of the specific stages in the M&A process. It deals with the preparatory stage, due diligence, implementation, and the subsequent integration of the two and more merged companies. The dissertation also provides evaluation of the individual stages’ importance. Special attention is given to the most frequent problems occurring during the entire M&A process: human resources and the integration process. In addition, the dissertation responds to the changes in economic environment that took place between the economic boom, at the beginning of the millennium, and the recession that commenced in autumn 2008. It also shows possible future developments in M&A. The dissertation was based on a review of the existing secondary sources; on primary research in companies with experience in M&A, and on collaboration with the tutor and other experts in the M&A field. On the grounds of secondary sources review, primary research, and discussions with experts, a guide on how to successfully implement an M&A transaction was prepared. The dissertation is to serve for didactic purposes in educating future managers, as a guide for companies’ management which implement M&A transaction, and should provide a basis for further research and scientific work in the M&A field. The dissertation’s conclusion evaluates hypotheses formulated prior to its elaboration.

The utilization of mergers and acquisitions has over the years become a central part of expanding and growing an organization. To acquire or merge with another firm is often described as a way to facilitate better and faster organizational development, in ways that organic growth cannot. In conjunction with the increase in popularity of mergers and acquisitions, the academic attention towards this area has also grown subsequently. According to scholars, due diligence can be used as a tool to ensure that the acquiring firm and the target firm are a good match, as well as ensuring that any seller statements are consistent with reality. The academic attention towards due diligence is, however, described as surprisingly limited. Previous researchers are calling for an increased and deeper understanding of due diligence in general. Therefore, the purpose of this study is to further develop theoretical knowledge and expand the understanding of due diligence. More exactly, we have targeted Swedish small and medium-sized firms that have acquired another firm recently by asking the following research questions; What are the drivers and challenges of pre-acquisition due diligence for Swedish SMEs? and; How is the pre-acquisition due diligence process managed by Swedish SMEs? and; How are the results of the pre-acquisition due diligence applied? Semi-structured interviews with CEOs, founders, managers, and heads of M&As from seven Swedish SMEs were conducted, based on both scholarly suggested evaluation procedures and a literature review within the field of due diligence. All interviews were conducted and recorded through an online tool which facilitated the process of transcribing, analyzing, and producing the empirical findings. By using qualitative thematic analysis the respondents’ answers, thoughts, and insights were accordingly categorized into one of four main themes and subsequent sub-themes. The findings showed that due diligence brings overall value and that it is a necessity in the process of acquiring, even though it is a rather expensive and time-consuming process that can interrupt the everyday agenda at the acquiring firm. Furthermore, the findings also showed that the management of the due diligence process and the utilization of the results differed considerably between the investigated firms. Lastly, the findings indicate a need for future technological development in the field of due diligence, to achieve a more cost- and time-effective process.