M&A's no longer in fasion
A week ago I attended an academic conference named "Fusion: creating synergy?"
IN essence the conference was about mergers and acquisitions.
Many famous people talked there. I only knew one fo them: Geert Hostede. Basically I attended the event because of him. But you might find other famous people as well. (www.managementweek.nl)
The key take-away from the conference:
- Managers are afraid to implement M&A's
- You should not merge if you can avoid it.
Statements were supported by the following arguments:
- M&A fail more often than they suceed
- It is damn difficult to implement mergers well
- # of M&As has decreased significantly
- Most mergers nowdays are done by financial investors, not "corporates".
For me it was a discovery. Maybe my knowledge was outdated, but I still considered M&A as a hard, but innevitable and the right way to go...
posted by Tadas Zibuda @ 17:40
2 Comments
2 Comments:
But M&A is cool and managers like to manage larger companies and gain more power. They mostly fail, but who cares ;).
On American side there will always be more mergers due to different corporate culture, so perhaps there was some European attitude in your conference. M&A activity is seasonal and it is picking up again as stock market goes up and companies feel they can raise 'cheap' capital for acquisition (remember AOL?).
USA has always been responsible for around 50% of world mergers. But even in US the numbers have decreased drastically during recent years.
A true point: managers often merge solely for the desire to appear on a Fortune cover page. Especially in the US.
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