Disadvantages of mergers and takeovers

Disadvantages of mergers and takeovers

1. less than half of all takeovers and mergers are successful

   • its hard to make 2 businesses work as one
   • Management styles differ between firms
     • one firm may be used one company's culture
     • may not be motivated by the style used in the other company

2. They create bad feeling

   • the firm may agree it be taken over
   • sometimes the takeover bid is hostile and unpopular

3. They often lead to cost-cutting.

   • May make a lot of people redundant
     • leads to tension
     • leads to uncertainty among workers