Publikation

Timing Concepts Affecting the Odds of Success or Failure of M&As

Outline:

N. Zadrazil, O. Lehner - Timing Concepts Affecting the Odds of Success or Failure of M&As - British Academy of Management Proceedings, NewCastle, Vereinigtes Königreich von Großbritannien und Nordirland, 2016

Abstract:

M&As are a strategic instrument to grow for corporations. However, acquiring corporations have to face a large number of challenges to really succeed in merging two organisations. Half of all transactions have been failing resulting in disastrous write-offs and losses for corporations. Research has been trying to find a panacea against M&A failure for years investigating motives, synergies, performance and the M&A process. In more detail, research has focused on different timing concepts: market timing and integration speed. Other timing concepts seem to have been neglected so far, although several cases show early evidence for their existence. The purpose of this paper is to identify further concepts of timing besides integration speed and market timing. In order to identify such concepts the author has chosen a qualitative meta-analysis. The author has collected 30 cases of past mergers within various industries. To avoid any bias, the collection consists of 15 successful and 15 failed mergers. These cases have been investigated for any codes highlighting timing concepts. This study reveals six timing concepts with crucial impact on the M&A outcome: time for acquisition, M&A duration in its entirety, M&A sequence, synergy chronology, frequency of acquisitions and time to step back. The extent of their impact varies as does the ability to control them. Most important are the M&A sequence and synergy chronology as they do have the highest impact and are most likely to be controlled by acquiring corporations. It is suggested to focus on these timing concepts in future research. Time for acquisitions cannot be chosen freely in some cases. The M&A duration in its entirety does not influence the outcome of a transaction. The frequency of acquisitions only refers to huge corporations and the time to step back should only be considered as an emergency exit granting the minimal loss.