MERGERS AND ACQUISITIONS: A Strategic Approach to Diversification

Mergers have not increased profitability, have not improved efficiency, have not expanded sales and, in fact, do not seem to yield sufficient benefit to anyone—consumer and company alike. These startling statements are some of the conclusions drawn by researchers from seven countries working on a project coordinated by the International Institute for Management and Administration in Berlin. Their conclusions were based on data collected over the last decade on 765 mergers in Europe and the United States. Needless to say, findings such as these are bound to fuel debate about management's ability to merge successfully. But is this something new, peculiar to the last decade only? History might give a clue as to how merger activity has fared.