How to Get Mergers and Acquisitions Right
The buzz is back around mergers and acquisitions (M&As) as businesses explore consolidation within their industry ranks as a way to survive or thrive in challenging times marked by high interest rates and fears of a recession. For instance, the recent standoff in Hollywood between writers and producers sparked talk of a rash of M&As. More broadly, a familiar theme returns: Why do many M&As fail and how can they pay off?
M&A deal flow in the first half of this year has been the lowest since the corresponding period in 2020. According to Wharton management professor Emilie Feldman, financing M&A deals is tough in the prevailing environment, with high interest rates, sluggish stock prices, and companies being much less cash-rich than they were at the end of the pandemic. She shared her insights on why M&As fail in a recent episode of the Wharton Business Daily radio show that airs on SiriusXM.
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