The art to transact an acquisition and merger - A qualitative study of a merger and acquisition transaction unfolding and aspects influencing the process

Abstract

Studies are presenting that approximately less than a third of mergers and acquisition are set to satisfy managers, resulting in high levels of unsound activities that are strategically inadequate and costly for the organizations, making the concept merger and acquisition as a strategy of growth and synergy to critically being evaluated. What aspect could possibly result in such un-sound outcome? This paper studies and examines an acquisition and merger transaction of a privately owned and managed firm since traditionally, there is multiple challenges with an sale of a privately owned and managed firm whereas some complications being information asymmetry between the seller and buyer, valuation difficulties and future uncertainties of how acquired firm should be operated and managed. Utilizing actor network theory and the lens of translation model, this study discovers that the elements of organizational culture and communication performs a great influential function during pre and post-acquisition and merger. On a further consequent note, this study presents how the prime aspect influencing the process in a progressive direction was how respective organizational culture of the two companies had identical elements to them. Finally, the paper accentuates the significance purpose managers perform during the acquisition and merger as they are the one’s directly communicating the process. In conclusion, the study provides further contribution and insights to the field of mergers and acquisitions and actor network theory, particular how actor network theory accomplished to study and analyze influential aspects affecting the merger and acquisition direction.