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The applicationsTable 6.1ContinuedReason for Advantages Disadvantages OrganizationalM&A activityimplicationsIntegration Buyer or supplier More work for the Integated top team,power automatically top team. mergedreduced if other party In the case of administrativeis buyer or supplier. horizontal integration systems, tightlyMore control of (other party is a coupled corecustomer demands competitor), cultural processes, singleor supply chain problems often hard corporate identity,respectively. to overcome, thus better partnershipBetter partnership potential not realized. working, pooleddesired for public Complex ‘dual’ resources, bettersector organizations. structures often services.Reduction inresult to spare egos.competition (if otherparty is competitor).Increase in marketshare/marketingstrength.Defensive Enhance the May be very If managed well, itmeasure company’s unexpected for staff leads to greatercommercial position and low performance commercial strength.in the face of weighty can result fromcompetition.confusion.Deal doing Seductive and thrilling. The excitement of the Anyone’s guess!Publicity surrounding deal may cloud thethe deal augments CEO’s judgement.the CEO’s and thecompany’s profile.LESSONS FROM RESEARCH INTO SUCCESSFUL ANDUNSUCCESSFUL MERGERS AND ACQUISITIONSThe following quote from Selden and Colvin (2003) gives us a starting point:70% to 80% of acquisitions fail, meaning they create no wealth for the shareowners of the acquiring company. Most often, in fact, they destroy wealth…Deal volume during the historic M&A wave of 1995 to 2000 totalled morethan $12 trillion. By an extremely conservative estimate, these deals annihilatedat least $1 trillion of share-owner wealth.228