MERGERS
Mergers are business combination transactions involving the combination of two or more companies into a single entity.
Source: SEC.gov
What makes a merger successful? Can success be measured immediately or in the long run? Many factors should be considered before merging. Reviewing what each company offers, determining whether the goods are compliments, and deciding whether the expanded customer base will open upnew markets can help decide whether a merger is a good idea. Other factors, such as the two company cultures and the ability to unite, should also be considered. Sometimes mergers lead to products/services which cannibalize each other and cause direct competition with very little differentiation.
According to the CNBC slide shows in the link below, one of the best mergers was that of Disney and Pixar. With competitors of the big and small screen all using digital cartoons instead of the traditional methods of cartooning the merging of Disney storytelling with Pixar's expertise in digital cartoons allowed Disney to stay a leader in animation combining forces with another leader in digital graphics.
Alternatively, mergers could turn into disasters. For instance, the merger of TimeWarner with AOL was thought to bring the synergies of print and online world together. Unfortunately, this deal did not consider future technologies and how rapidly AOL's core, dial-up internet, would become obsolete.
Top 10 Best (and Worst) Mergers of All Time - CNBC
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