BUSINESS life: Study shows growth bid pitfalls.POORLY-EXECUTED mergers and acquisitions are a prime cause of under-performing in UK businesses, according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. a new Deloitte & Touche study. Deloitte reviewed the 40 most recent investigations carried out by its reorganisation Noun 1. reorganisation - the imposition of a new organization; organizing differently (often involving extensive and drastic changes); "a committee was appointed to oversee the reorganization of the curriculum"; "top officials were forced out in the cabinet services practice. The study revealed that 57 per cent of the businesses had a failed merger or acquisition as the leading cause of their problems. In 40 per cent of cases, the acquisitions also had to be sold as part of the restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). . The research identified consistent problems with the merger or acquisition that caused the businesses' distress, with integration difficulties the common theme. Most often the problems arose from a failure to integrate the acquired business in time - or at all. In other instances, the acquisition rationale rationale (rash´  nal´),n the fundamental reasons used as the basis for a decision or action. was ill-conceived, which led to overpayment o·ver·pay v. o·ver·paid , o·ver·pay·ing, o·ver·pays v.tr. 1. To pay (a party) too much. 2. To pay an amount in excess of (a sum due). v.intr. To pay too much. and a poor strategic fit, making integration harder. In some cases, the businesses made serial acquisitions to hide previous integration failures and underlying financial problems. The study also reveals the length of time between deals being made and the failure becoming evident. In 50 per cent of cases, the timeframe was a year or less; in 40 per cent it was one to two years; and in 10 percent it took more than two years. |
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