Intellectual Property, Insights

The Case of Twitter’s Change To ‘X’- Maximizing Brand Value and Trademarks in M&A Transactions

One of the key drivers of M&A activities in today’s economy is innovation and brand value. In 2020, 90% of the S&P 500 companies’ value is attributed to intangible assets, highlighting the tremendous impact they command. A strong brand can be an important advantage in the M&A process. It gives all stakeholders an understanding of the company
they are dealing with, highlighting the culture and identity of the organization. A well-articulated brand conveys the company’s unique value proposition, thereby facilitating the task of identifying strengths, weaknesses, and areas of synergies between merged companies. This information helps guide negotiations and smoothens the journey through the M&A process.

These actions, signals effort by the company to strengthen their positions, extend their reach, diversify their offerings, or even reinvent themselves. Thus, trademarks and brands are quite valuable. They serve as a significant asset for any enterprise, particularly in the modern, highly competitive, and brand-centric market landscape. They play a vital role in fortifying brand identity and guarding against counterfeit enterprises, hence their increasing prominence during merger and acquisition due diligence.

As a merger process unfolds, businesses often experience disruption, with pressure from management, and customers often questioning the supposed benefits of the deal. Once the deal, however, closes, the initial wave of excitement often subsides, giving way to the unnerving prospect of integration. In this case, a valuable brand could either serve as a unifying force or could create a difference of opinion in brand acceptance…

 

 

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