Saw an interesting report from the McKinsey Quarterly (in their "Chart Focus" series), that talks about the problem with mergers and expectations of success. The report discusses the misguided expectations that companies have entering into large mergers. The oft-stated "synergies" in revenue and costs more often than not fail to materialize.
Given the recent trend in the market towards consolidation and larger mergers, this is interesting information for any company - and perhaps more interesting to the investor that is looking for the real return on equity in a large merger, and whether the benefits justify the costs. HP/Compaq, anyone?
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Musings about life, liberty, and the pursuit of happiness.
