Many industry experts predict that the merger and acquisition market (M&A) is going to turn around later this year. This theory was outlined in several recent articles including one by TechFlash’s John Cook, “When will the high-tech M&A bottom feeders emerge?” and another from IDG News’s Marc Ferranti “Wall Street Beat: M&A, Oracle Stress the Positive.”

In the TechFlash article Bill McAleer, a managing partner at Voyager Capital, shared with John Cook that there are a number of large companies (such as Oracle, Microsoft, etc.) with strong cash positions who are preparing to leverage the recent economic downturn to get some good deals in the acquisition arena. We are starting to see some evidence of this happening with recent acquisition news from Cisco, merger discussions between IBM and Sun and statements from Steve Ballmer indicating that Microsoft is ready to do several (10 – 20) small deals of less than $500 million.

While increased M&A activity is good news, there is still significant competition among companies looking for acquisition as an exit strategy. Additionally, companies are now faced with reduced valuations. Much like a home owner coming to terms with the decreased value of their home, company executives and investors will need to be prepared for lower terms.

For companies looking to be acquired, cost-effective, strategic public relations is a critical tool for raising awareness, increasing valuations and ultimately accomplishing the desired exit.

According to Ferranti’s article, a recent report by 451 Group revealed that corporate buyers “are looking for ‘bolt-on” deals that help vendors in specific market niches.” These niche companies need to raise awareness with potential acquirers to demonstrate how their product, solution or technology will be a strategic asset as well as how they can integrate effectively within the organization. Public relations can be extremely effective to boost a company’s visibility and ensure its valuation is maximized.

In our book, “Strategic Public Relations: 10 Principles to Harness the Power of PR”, we include a sidebar “A Focused Approach to PR: How PR Helped Tegic Raise Its Sales Value” in which Don Davidge, Tegic’s former vice president of marketing and sales reveals how PR helped Tegic secure its acquisition by AOL and how later, an AOL executive told him “his team had internally calculated they paid an extra $50 million for Tegic just because of how much buzz there was about the company.”

Today’s business climate may be more conservative; however, PR can be a powerful tool to ensure your company is on the radar with potential acquirers. In addition, PR can increase the perceived valuation of the company and possibly create a sense of urgency for the completion of an acquisition.