Why mergers and acquisitions don’t work

John Ward

Points out the dangers of growing a business through mergers and acquisitions (M&A). It is expensive, inefficient and rewards the chief executive’s ego rather than the shareholders.

Why Mergers and Acquisitions Don't Work

John Ward

Look at the business pages of the national press these days, and every week you'll see at least one CEO or finance director 'under City pressure' because of an acquisition or merger that has produced higher costs and lower growth than anticipated.

Recently, for example, Morrisons has been in a deal of trouble, issuing profit warnings that resulted from the accumulated costs of taking over Safeway. Before doing this, the successful northern retailer had grown organically by understanding its customers' needs. What it didn't understand was the southern consumer in general or...

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