To Merge or Not to Merge…?
Mergers or acquisitions only make sense when the combined entities create greater value together than they can separately.
Locate and provide a link to a recent news story from The Wall Street Journal or other reputable news source about a merger or acquisition that has been announced between two publicly-traded companies in the last year. To avoid repetition, please find an M&A article that other students have not discussed.
In your own words (not simply copied from the article), describe how the combined entities were expected to create greater value together than separately (e.g., how they were going to increase revenue, lower costs, and/or better manage risks). Be descriiptive and thorough in explaining these potential synergies. To support your response, include specific references to M&A strategies discussed in Chapter 6 of The CFO Guidebook.
Applying your business acumen and emerging CFO skill base, provide your assessment and supporting rationale about whether this merger makes sense from three perspectives:
Does the merger make sense from a strategic fit perspective?
Does the valuation of the deal seem reasonable?
Identify the biggest risk(s) you think the acquirer will confront in extracting the synergies post-transaction.