Mergers and acquisitions

During the past 25 years an increasing proportion of U.S. companies have seen wisdom in pursuing a strategy of diversification. Between 1950 and 1970, for example, single-business companies comprising the Fortune “500” declined from 30% to 8% of the total. Acquisition has become a standard approach to diversification. In recent years the productivity of capital […]

Now that providing services is more lucrative than making products, the old foundations for success in manufacturing are crumbling. Smart manufacturers are creating new business models to capture profits at the customer’s end of the value chain.

Why “buying to sell” can generate a much higher return on investment than the public company practice of “buying to keep”

Companies are increasingly paying for acquisitions with stock rather than cash. But both they and the companies they acquire need to understand just how big a difference that decision can make to the value shareholders will get from a deal.

The Idea: Landel uses four basic rules to decide what services to offer and where. The overarching goal is to improve people’s lives, whether they work for client companies or for Sodexo itself.

AT&T’s recently announced acquisition of T-Mobile will invite hellfire from telecom regulators who fantasize over a different market structure, in which 17 mom-and-pop carriers serve the masses with tender love and care. As an economist, and as a customer of AT&T (with my mom, wife, and oldest daughter on my account), I am not so […]

A merger that immediately boosts your earnings per share is better than one that dilutes it, right? Wrong.

Merck's acquisition of Medco Containment Services in November 1993 set off a wave of controversial mergers between pharmaceutical companies and prescription-benefits-management...

Lessons from a trio of recent high-profile busts.

Less than a decade after the frantic merger activity of the late 1960s, we are again in the midst of a major wave of corporate acquisitions. In contrast to the 1960s, when acquirers were mainly freewheeling conglomerates, the merger movement in the 1970s includes such long-established giants of U.S. industry as General Electric, Gulf Oil, […]

Editor’s Note: This blog post is a sneak-peek to the upcoming article, “The Merger Dividend,” by Ron Ashkenas and his colleagues Suzanne Francis and Rick Heinick, which will appear in the July-August issue of HBR. Over the last ten years, I’ve talked with hundreds of managers who have been deeply involved in the post-merger/acquisition integration […]

Many firms sit on the sidelines of global competition, believing they need to develop innovative products or leading brands before venturing abroad. The...

Executives spend a lot of time creating and acquiring businesses but rarely devote attention to divesting them. As a result, they often end up selling businesses too late and at too low a price, sacrificing shareholder value.

Sometimes when you win, you also lose.

Cross-border mergers and acquisitions are gaining momentum in China. To be successful, acquiring companies must understand certain M&A idiosyncrasies...

Only 16% of reorgs deliver on their objectives.

Small companies are competing with big businesses in whole new ways.

How to stay focused on customer experience.

Many comic fans around the world, my eldest son John included, will bemoan today’s announcement that the Disney entertainment zaibatsu will swallow up Marvel Comics and its 5,000 characters for $4 billion. Years ago I, too, spent my hard-earned shoveling money on Spiderman, The Hulk, Fantastic Four, and especially Iron Man. (I’ve seen all their […]

Companies spend more than $2 trillion on acquisitions every year, yet the M&A failure rate is between 70% and 90%. Executives can dramatically increase...