The Value Killers: How Mergers and Acquisitions Cost Companies Billions--And How to Prevent It

Abstract

Intro -- Dedication -- Acknowledgments -- Contents -- Introduction -- The Enduring Allure of 2 + 2 = 5 -- Most Mergers Destroy Value -- The Usual Suspects -- The Road to Hell … -- The Five Golden Rules -- 1: Don't Rely on Investment Banks for Valuation -- Where Were the External Advisers? -- Winners and Losers -- Alternatives to the Success Fee -- The Benefits of In-House Valuations -- Internal Teams Should Steer the M& -- A from A to Z -- Summary -- Questions for Executives Considering Future M& -- As -- 2: Avoid "Strategic" Deals -- "Strategic" Is a Dangerous Word -- Good and Bad Reasons for Doing Deals -- Boards Can Prevent Bad Deals -- It's Not the CEO's Job to Diversify the Company's Portfolio -- Red Flags and Green Flags -- Summary -- Questions for Future M& -- As -- 3: Link the Before and After -- Multiple Teams Can Produce Disappointing Results -- Why Use Different Teams? -- Wanted: Preparation and Follow-Through -- Culture: The Universal Scapegoat -- Insights from Successful Culture Warriors -- Should Culture Ever Be a Deal Killer? -- Culture Integration Solutions -- Desired End State -- Summary -- Questions for Future M& -- As -- 4: Think Like a Financial Investor -- Most Acquirers Overpay -- What Would Gordon Gekko Do? -- Identify Hard and Soft Synergies -- Calculate the Target's Stand-Alone Value and the Value with Synergies -- How Payment Methods Affect Deal Outcomes -- Measures to Prevent Overpaying -- Synergy Summits -- Summary -- Questions for Future M& -- As -- 5: Move Fast and Communicate Transparently -- Higher Attrition Rates Can Last for Years -- Speed and Effective Communication Are Imperative -- For Employees, Bad News Is Often Better Than No News -- Meet with New Customers ASAP -- Use Your Time Wisely -- Summary -- Questions for Future M& -- As -- 6: Conclusion: Closing the Deal, But at What Price?.