Why Merger Fails To Create Value
Mergers are supposed to make companies more productive. They’re meant to get rid of inefficiencies, grow revenues and result in a stronger bottom line. But sometimes things don’t go according to plan. The new team won’t buy in, middle managers are unhappy with their pay, and the acquired company isn’t reaching its projected growth. What happened? In numerous studies, researchers have found that somewhere between 50-80% of Mergers Fail To Create Value for shareholders. While some people believe the major issue is dealmakers who get caught up in trying to close deals at any cost, we believe that failure is more often the result of bungled attempts to merge the companies after the papers are signed. AxialMarket Member until they were recently acquired by Badger Meter, spoke with us about his successful acquisitions and how he avoided three major issues common in most acquisitions. 1) Conflicting HR Policies and Pay Structures: A huge issue in mos...