When Bad Things Happen To Good Mergers

Gooding, Richard Z.
September 1998
Financial Executive;Sep/Oct98, Vol. 14 Issue 5, p24
Academic Journal
The article discusses the reasons why a majority of business mergers fail. Reasons include management's failure to: evaluate information for decision making, implement due diligence, and recognize information asymmetry. The discussion focuses on the confirmation, availability, and escalation traps which relate to the accuracy of data, unrealistic attitudes of executives, and bias in the decision-making process. Examples include due diligence at DynCorp., a strategic risk assessment before an acquisition by Axxess Technologies, and a takeover strategy at MicroAge.


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