What are the top M&A Deal Failures?

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  • This topic has 22 replies, 23 voices, and was last updated 7 months ago by Anonymous.
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  • #126747
    Anonymous
    Inactive

    Cultural misalignment and regulatory challenges are on the top of the reasons why a deal fails.
    The following are some examples of deal failures in last 10 years:
    1- AstraZeneca and Pfizer (2014):
    Reason for Failure: Cultural misalignment and political opposition.
    2- Comcast and Time Warner Cable (2015):
    Reason for Failure: Regulatory challenges.
    3- AbbVie and Shire (2014):
    Reason for Failure: Tax inversion issues due to changes in U.S. tax laws.
    4- Publicis and Omnicom (2014):
    Reason for Failure: Leadership disputes and cultural clashes.
    5- General Electric and Honeywell (2001):
    Reason for Failure: Antitrust issues (notable historical example).
    6- Qualcomm and NXP Semiconductors (2018):
    Reason for Failure: Geopolitical and regulatory roadblocks, particularly from China.
    7- AT&T and T-Mobile (2011):
    Reason for Failure: Antitrust concerns.
    8- Kraft Heinz and Unilever (2017):
    Reason for Failure: Cultural clash and strategic mismatch.
    9- SoftBank and WeWork IPO (2019):
    Reason for Failure: Mismanagement and valuation issues.
    10- Sprint and T-Mobile (2014):
    Reason for Failure: Regulatory concerns.

    #130067
    Anonymous
    Inactive

    – AOL and Time Warner
    – Quaker Oats and Snapple
    – Sprint and Nextel

    #130246
    Anonymous
    Inactive

    Recently read about Just Eat and Grubhub deal.
    Just Eat Takeaway acquired Grubhub for $7.3 billion to enter the U.S. market. Facing intense competition and strategic challenges, Just Eat sold Grubhub in 2024 for $650 million, incurring a significant $6.5bn loss.

    #130916
    Anonymous
    Inactive

    Tata’s bid for Jaguar and then finally acquiring it.

    #131075
    Anonymous
    Inactive

    Hi, I think apart from the cultural integration, another reason for M&A failure lies in the excessive “acquisition premium” paid during the process.

    M&A process is often run as an auction process, with multiple interested buyers competing to acquire a target at the most attractive price. In the heat of “winning the deal”, valuation is often inflated, and synergy justifications are often only considered in the aftermath. In other words, many M&A deals can be seen as setting up for failure, due to lack of scrutiny of the value creation synergies.

    #133773
    Anonymous
    Inactive

    The main reason that lead to the failure of an M&A operation is not having an integration plan that anticipates the problems that may arise post closing.

    #133958
    Anonymous
    Inactive

    I think some reasons are:
    Overpaying for the Target Company
    Cultural Misalignment
    Unrealistic Synergy Expectations
    Leadership and Talent Retention Issues
    Regulatory and Legal Challenges

    #134050
    Anonymous
    Inactive

    unclear deal rationale

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