Two merger integration imperatives: urgency and execution

Abstract

Today, with years of corporate experience in managing mergers and acquisitions, there is little excuse for deals that don’t create value. Regrettably failure is the case more often than not. Depending on the industry, a top‐performing merger can increase shareholders’ wealth anywhere from 4 to 65 percent above industry averages. But such rewards only go to companies that understand that merger success is built on two main factors: timing and execution. A.T. Kearney’s findings indicate that a company has just two years to make the deal work. After year two, the window of opportunity on forging merger synergies has all but closed. This article highlights the reasons why timing is so important to merger success, and lays out the seven ground rules‐from selecting leaders quickly, and establishing clear goals, to managing risks and expectations – that leading acquirers abide by to ensure merger success.