Merger & Acquisition : Avoiding the path of decay

• Main Authors: Got, Elisa, Sanz, Fabrice
• Format: Others
• Language: English
• Published: Linköpings universitet, Ekonomiska institutionen 2002
• Subjects: Business and economics; Merger; Acquisition; Failure; Synergy; Model; Transnational; Value; Culture; Strategy; Management; Organisational Efficiency; Ekonomi
• Online Access: http://urn.kb.se/resolve?urn=urn:nbn:se:liu:diva-1023

Background : Globalisation has led company to think globally and act locally. Such a change in the business world have made emerge the need to find partner around the world, and even to merge with complementary companies in order to sustain the corporate strategic advantage and to create value. Purpose : The objective of this paper is to integrate major Merger & Acquisitions theories in order to establish a warning model pointing out the main pitfalls changing promising motivations into failed implementation in the process of Merger & Acquisition. Such a model will aim at preventing managers engaged in a transnational horizontal merger from the potential hazards leading to value destruction. Delimitations : We choose to focus on the transnational merger because it should play with different national management and with the consequent variance in cultural distance ; the human and social context appears more clearly as fundamentally variable when a merger involves different sensibilities. Results : After having integrated the main theoretical finding into a holistic framework which enabled us to shape a warning model we tested successfully in case of Pharmacia-Upjohn merger, which aims at analysing the general risks of one strategic merger or/and the following implementation process.