Posted by Ross Hall on January 30, 2002 at 11:55:50:

In Reply to: Re: KM, Business and Mergers: A question posted by Riva Gianluca on January 30, 2002 at 11:09:31:

Riva,

Interesting observation that you make about mergers being an attempt to unify skills. Certainly in some transactions the merger takes place because there is a desire to unify, but that is not the only reason.

These are a quick run down of the reasons I've been given for contemplating a merger or acquisition in the UK Insurance Broker market over the past 12 months:

purchase of niche products and / or clients;

desire to get bigger faster;

"prices are so low we'd be stupid not to";

personal empire building;

belief that you either merge or go out of business;

unable to gain access to markets as two "small companies";

build buying power with markets;

protect market share ("If I don't buy the guy two doors down my competitors will!");

share a common view of how the market is going to work out;

leverage combined buying power (subtly different from building buying power);

and so on.

IMHE the ones that work are the ones that are done for proactive business reasons. Reacting to circumstance tends to lead to disaster!

Ross ;-))

• Ross Hall: Consultant, Speaker, Writer

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