The M&A Failure Trap

Auteur

BARUCH LEV is New York University's Accounting and Finance Professor (emeritus), formerly at Tel Aviv University, UC Berkeley and the University of Chicago. He worked in accounting and investment banking, and did research and consulting in finance, accounting and corporate valuations. Lev wrote 7 books and 125 research studies which were cited more than 62,000 times (Google Scholar). FENG GU is Professor and Chair of Accounting and Law at the University at Buffalo School of Management. He has published research focusing on analysis of financial information, relevance of corporate accounting reports, and valuation of intangible assets.

Texte du rabat

PRAISE FOR THE M&A FAILURE TRAP "The M&A Failure Trap is a delightful blend of vivid storytelling and statistical rigor. An eye-opening and wide-ranging guide for executives and investors keen to understand M&A."
-- Michael Mauboussin, Head of Consilient Research for Counterpoint Global at Morgan Stanley Investment Management "As a 20+ year executive in the cybersecurity industry, both with highly acquisitive companies like RSA and VMware, as well as several cyber startups, I've been involved with dozens of acquisitions. I have witnessed first-hand the complexities and challenges that come with M&A. Too many acquisitions fail to create their expected value, and often the biggest challenge is not 'making the right deal, ' but rather 'making the deal right.' The M&A Failure Trap is an amazing resource for anyone involved in this high-stakes arena. For corporate leaders, the sections on due diligence, integration planning, cultural compatibility, realistic synergy expectations, and post-acquisition monitoring are particularly valuable. I wish I had this book a decade ago."
--Tom Corn, former Senior Vice President, Security Products, VMware "While you can make a case for acquisitions as value creating in some companies, the truth is that acquisitions rank among the most value destructive of all corporate actions. Egged on by an ecosystem of bankers and consultants who make money off M&A deals getting done, companies often over promise and over pay. Lev and Gu start with the recognition that acquisitions fail far too frequently, but they also map out pathways for value creation, based upon data and their in-depth understanding of the economics of and accounting for acquisitions. It is recommended reading for anyone in the M&A space."
-- Aswath Damodaran, Professor of Finance and Kerschner Family Chair in Finance Education, New York University "Authors Baruch Lev and Feng Gu performed the most in-depth study of M&A ever undertaken, deploying advanced statistical techniques to analyze 40,000 transactions. Their conclusion totally contradicts the Wall Street chorus of cheerleading and management claims of major 'synergies' and 'value creation' when these deals are announced. Lev and Gu show decisively that 70% to 75% of all M&A prove a raw deal for the acquirer's shareholders. Yet they also provide a checklist of warnings that if heeded, will keep CEOs from falling into the trap. Among them: avoid paying big premiums, beware the integration challenges from acquiring foreign targets, and don't hype the transaction's potential. Put simply, The M&A Failure Trap should be a required primer in all C-suites across the globe."
--Shawn Tully, Senior Editor-at-Large, Fortune magazine "Poorly conceived M&A transactions appear among the best ways to burn billions of dollars. But Lev and Gu critically show it's not all doom and gloom. In fact, they show predictable data-driven ways to identify the likelihood of actual success. For any corporate leader considering an M&A transaction, the lessons within this book will reap dividends many fold."
-- Eugene Soltes, McLean Family Professor of Business Administration, Unit Head, Accounting & Management, Harvard Business School

Contenu

Preface ix

Preamble Why Should You Read This Book? xi

Chapter 1 Appetizer: The Good, the Bad, and the Ugly 1

Chapter 2 The Ever-Changing Nature of M&As (1): Deal Characteristics 17

Chapter 3 The Ever-Changing Nature of M&As (2): Markets and Merger Sizes 27

Chapter 4 Internal Development: The Alternative to Acquisitions 37

Chapter 5 The Folly of the Conglomerate Acquisitions 53

Chapter 6 Are There "Best Times" to Acquire Businesses (1)? External Opportunities 65

Chapter 7 Are There "Best Times" to Acquire Businesses (2)? Internal Opportunities 79

Chapter 8 Integration - The Achilles' Heel of M&A 91

Chapter 9 Accounting Matters 105

Chapter 10 Killer Acquisitions 119

Chapter 11 Holding onto Losers 125

Chapter 12 Means of Acquisition Payment: Cash, Stocks, or Mix? Does It Matter? 135

Chapter 13 But What If Executives Are Irrational or Self-centered? 143

Chapter 14 The Human Element: Acquisitions, Executives, and Employees 155

Chapter 15 Do It Yourself: Predict an Acquisition's Outcome 169

Epilogue How to Spring the M&A Failure Trap 187

Appendix Our Research Methodology 195

Index 207