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Chapter 4. Does Anyone Care That I 'm He... > Mergers, Partnerships, Alliances, an...

Mergers, Partnerships, Alliances, and Acquisitions

Technology makes it easy to combine widely dispersed organizations. History tells us that more often than not, that's a really poor idea. With success measured by stock prices:

  • 70 percent of all international mergers fail.[2]

  • In a study of 300 major mergers over a 10-year period, Mercer Management Consulting found that 57 percent of the returns of the merged companies lagged behind the average for their industries.[3]

  • The number of alliances, joint ventures, and partnerships continues to grow, even though most studies report high failure rates.[4]

  • Anderson Consulting Managing Partner Charles Kalmbach, Jr., reported that 61 percent of corporate partnerships are either outright failures or are just “limping along.”[5]

  • Multiple studies of past waves of mergers reveal that two out of every three deals did not succeed.[6] The only people who made money were shareholders of the acquired company, who received more than the company was worth.

  • An analysis of U.S. companies acquired since 1997 in deals worth $15 billion or more revealed the stock of the acquirers underperformed the S&P 500 Stock Index by an average of 14 percent and underperformed their peers by four percent.[7]


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