Lance Nail

Integration problems and turnaround strategies in a cross-border merger A clinical examination of the Pharmacia-Upjohn merger

Abstract With the increasing globalization brought about by consolidation, crossborder mergers are growing increasingly popular as means of rapidly achieving size-related economies of scale and scope as well as global reach. However, integration issues such as culture clashes, which are problematic in domestic mergers, are often more severe when the merging companies are headquartered in separate countries with widely differing social mores. This study is an examination of one such merger—the 1995 merger between pharmaceutical companies Upjohn of the United States and Pharmacia of Sweden. The clinical study explores the many initial integration problems experienced in this merger and the turnaround strategy used to counteract the problems.

Value creation in bundling utility mergers: A corporate focus anomaly

Abstract Recent empirical studies have documented the significantly positive monotonic relationship between changes in corporate focus and firm value. Focus-decreasing activities such as diversifying mergers have been shown to diminish firm value while focus-increasing activities, including divestitures of unrelated assets, exhibit a value-enhancing effect. However, many of these studies follow the convention of excluding utilities as their regulated industry makes then incomparable to unregulated industries. Examining only utility mergers and acquisitions, this study finds that only those which occur between utilities operating in different primary lines of business (“bundling” mergers) experience significant increases in firm value. Consistent with other studies, conglomerate mergers lead to a substantial decrease in firm value. Horizontal and vertical mergers lead to insignificant wealth gains. These results present an anomaly to the corporate focus theory and indicate that the regulation of utilities creates value for related diversification - contrary to the monotonic relationship exhibited in unregulated industries.

Agrícola Ebro's tender offer for Campos Chilenos to control Iansa

Purpose – The purpose of this paper is to describe the wealth expropriation from minority to majority shareholders due to the lack of legislation protecting the interests of minority shareholders in an acquisition deal, validating the claims made on studies made by Zingales and by La Porta et al.Design/methodology/approach – Despite an overall takeover premium of nearly 250 percent, most minority shareholders actually suffered wealth losses ranging from US

Wealth creation versus wealth redistributions in pure stock-for-stock mergers

7.1 to 31.14 millions. These losses are measured using different methodologies, such as accounting value; liquidation value; and economic value.Findings – The Campos Chilenos case study presented here serves as a testing platform for the relationship between well‐developed legal systems and economic development in both a current and future sense. In a current sense, the case illustrates how inadequate minority shareholder protection led to minority shareholder wealth expropriation, discouraging minority investment from both domestic and foreign investo...