Global Leadership Series with Professor Michael J. Gibbs in Paris
Tuesday, March 25, 2014 at 6:30 PM (CET)
Some Companies are More Equal than Others: Why Mergers Often Fail
Michael J. Gibbs,
Clinical Professor of Economics; Faculty Director, Executive MBA Program, Chicago Booth
Mergers begin with great hopes for synergies, scale economies, access to new markets, and growth. Yet estimates are that more than half fail - do not live up to expectations - and many are eventually reversed. Why are so many mergers unsuccessful?
Professor Gibbs will discuss his research on mergers - focusing on post-merger integration. This step is often given short shrift during due diligence, but turns out to be the major challenge to successful merger. In their work, they found that few mergers actually result in mixing of workforces from the two companies, and that there is substantial turnover of the workforce as a result of the merger.
This research has useful implications for thinking about mergers in practice. For example, mergers of unequal partners are likely to fare better than those of equals. Merger in name, but not in organization, is likely to yield fewer synergies but may be the practical solution in many cases. When implementing a merger, the dominant firm should probably act quickly and aggressively to take control and implement change in the other firm.
Join us for a practical look at mergers ... beyond financial due diligence.
19:15 Program and Q&A
20:30 Networking Reception
9 avenue Franklin D. Roosevelt
Chicago Booth Alumni Office Europe
+44 (0)207 070 2299
The Chicago Booth Global Leadership Series provides executives worldwide with an unparalleled view of the complex environment and current trends facing businesses today. As the first top-tier business school to have permanent campuses on three continents (North America, Asia and Europe), the series is a natural outgrowth of Chicago Booth's role as a leader in international business education.