Building M&A Integration capabilities

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Building M&A Integration capabilities

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Title: Building M&A Integration capabilities
M&A practices as a key instrument to improve M&A integration
Author: Heimeriks, Koen H.; Zollo, Maurizio; Gates, Stephen
Abstract: While firms increasingly rely on mergers and acquisitions as a key growth instrument, many firms have difficulty successfully integrating the target. To counter the disappointing statistics, some firms like IBM and Xerox use M&A practices that capture learnings to improve M&A integrations. Comparing occasional with master acquirers, we find that those that make effective use of such M&A practices increase their chances of success with up to 24%. While there are plenty of reasons for M&A integrations to fail, we derive four key lessons that give master acquirers a leading edge over their occasional counterparts. The findings are based on survey data by 101 firms engaged in 2,447 integrations over the past decade and one dozen expert interviews. The conclusions are based using case examples of master M&A integration practices from six master acquirers IBM, Xerox, Home Depot, Dow Chemical, GE Capital Finance and SC Johnson. JEL code: G34
URI: http://hdl.handle.net/10398/7478
Date: 2006-12-08

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