The world today seems to be in a trance of business and deal making. In the previous years there are a great many acquisitions, consolidations and mergers that have taken place in various world’s market. Most of the business takeovers belonged to the dot-com bubble era following a massive rise in equity markets. In late 1990s, it grew exponentially rising the technology dominated Nasdaq index under 1000 to 5000.
Most of the recent moves include facebook acquiring Whatsapp for $19 billion which tended to be the largest takeover in the history of internet. Yet another deal is ongoing between Comcast merging with Time Warner Cable and its still under controversies and facing oppositions.
the honor of being the most tremendous takeovers in business dealing still appears to be with the dot-com bubble era. So here is a list of 11 biggest business takeovers in different industries.
In 2000, America Online bought Time Warner
In January 2000, America Online officially purchased Time Warner for US$164 billion. The deal structure stated that each original company would be a part of a completely new entity. The market capitalization of AOL made it own 55% of the new company and Time Warner to own only 45% of the company. So it came to be known as the acquisition of AOL.
It was considered one of the most expensive merger of the times but it failed pathetically because of the dropping of value of AOL drastically in 2001.
That’s how a great historic merger failed and is now considered one of the worst business takeovers in the history of media and entertainment.
In 2000 Vodafone acquired Mannesmann
The acquisition of Mannesmann by Vodafone in 2000, is more likely to be known as a hostile takeover in the history. The deal was finalized for $189.5 billion. now that Vodafone has become the world’s largest mobile phone operator , its quite convincing that why Vodafone desperately wanted to merge with Mannesmann.
The deal at that time represented an exceptional and extraordinary shift in the world of telecommunications. “what’s German should stay German” was one of the most common displays in Germany. Not changing the brand name was a part of the deal but Vodafone reneged later and rebranded. Mannesmann now exists in the list of steel industry.
Vodafone now works in partnership with 40 countries apart from those owned by Vodafone.
“Losses for year to 31 March 2006 reflect write downs of assets, principally in relation to the Mannesmann acquisition. Proportionate turnover includes £7,100 million from discontinued operations”.
In 2007, Royal Bank of Scotland Group, Fortis, and Banco Santander acquired ABN Amro Holding for $100 billion
The acquisition of ABN Amro by Ryal Bank of Scotland Group, Fortis and Banco Santander in 2007 for worth $100 billion is one massive and most expensive takeover in banking landscape. However it may be considered as one most embarrassing deal in today’s banking.
ABN AMRO from very beginning is a product of merging and acquiring battles. In 2007 , RBS acquired ABN AMRO in association with Fortis and Banco Santander for $100 million. At that time this consortium comprising of three banks was in competition with Barclay’s in acquiring ABN Amro.
In 2009 RBS announced a huge loss which was due to the ABN Amro acquisition .Unluckily the deal was failed due to the 2007-2010 financial crisis which put RBS and Fortis in great trouble.
The deal had put a massive damage to RBS and Fortis because deustch government had announced to nationalize it.
In 1999, Yahoo! bought Broadcast.com for $5.7 billion
In the line of internet business takeovers, the very first and recent takeover that comes in mind is facebook acquiring Whatsapp and Instagram in the previous five years. If the acquisition of facebook.com over Whatsapp is finalized then it would be able to attain the highest rank in this list. But for today’s charts, we still consider the acquisition of broadcast.com by yahoo to be the most expensive and tremendous takeover in cyberspace.
“1the combined entity looks very strong going forward,the deal gives yahoo a stronger foothold”, remarked Ryan Jacob. Broadcast.com being the leading internet audio and video broadcaster had agreed to merge with yahoo! which was already capitalized in market. So the acquisition’s primary aim was to propagate multimedia services on internet but it failed miserably along with geocities merger.
Today both broadcast.com and broadcast.yahoo.com redirects to yahoo.com making it crystal clear that the merger was a complete failure.
In 2001, Hewlett-Packard and Compaq Computer merged in a deal worth $25 billion:
In the list of rivaling and successful mergers in the history, one tremendous and gigantic combination is Hewlett Packard with Compaq computers. In 2001, HP and Compaq, as per a business deal merged to attain the best of the two companies together. Hewlett-packards weaknesses were complemented by Compaq’s strength, and the converse. This is how the merger boomed in the hardware technology and rose up in the charts and graphs of hardware analysis.
In 2008, InBev bought Anheuser-Busch for $52 billion:
In 2008, InBev and Anheuser effectively joined hands and combined to be the world’s largest brewing company. Because of the fact that America’s brewer market was very slow and insubstantial, the two companies’ move changed this convention and it brought the company to its boom.
Its now that the domination of 25%of global market belongs to the Anheuser-Busch InBev brewer company. It controls approximately seventeen brands yielding more the $1 billion in revenue each year.
“By bringing together these two great businesses, we have
created a stronger, more competitive global company with a leading international brand
portfolio and distribution network, and great potential for growth all over the world.” Said the CEO of the company.
In 2000, Pfizer bought Warner-Lambert for $110 billion
In the late 1990s, Pfizer looked forward to get alliance with warner lambert’s hugely profitable , cholesterol lowering drug Lipitor. Warner Lambert in this regard had first signed a merger agreement with American Home Products worth $72 billion. Within minutes, Pfizer offered $80 billions and proposed a merger as a biggest hostile bid ever. It made Pfizer the second largest pharmaceutical company in the world. It brought together two fastest growing companies in pharmaceutical industry.
A combined Pfizer and Warner-Lambert would have $28 billion in revenue and a $4 billion research budget, and annual cost savings could come to $1.2 billion.
In 2013, American Airlines and U.S. Airways merged in a deal worth $11 billion
In the late 2012, U.S. airways made a judgemental estimation that an increase of $1.5 billion a year in yield could be added in the avenue if U.S Airways get merged with the American Airlines. American Airlines was already in a phase of recovering bankruptcy. Therefore, in 2013 the merger was finalized etween American Airlines and U.S airways.
Shares of the combined company, now the world’s largest airline by traffic, rose 2.7% to $24.60 in their first day of trading on the Nasdaq Stock market.
Under the terms of the stock-swap merger, US Airways shareholders received 28% of the new company’s shares, while AMR’s creditors and equity interests are slated to receive the rest.
In 2008, Mars merged with Wrigley in a deal worth $23 billion
In the confectionery market , mars and Wrigley have joined hands together to create one largest company of confectioneries. In 2008, CEO of mars and CEO of Wrigley met and finalized the deal which initiated earlier. According to the views of both companies, they were enthusiastically supporting this merger to maximize the growth and market value of the companies.
The merger comprised of a deal to combine in the six core categories of confectioneries that included chocolate, non chocolate confectioneries, gum, food, drinks and petcare.
The deal was expected to be the global candy giant increasing annual sales upto $28 billion.
Bill Wrigley said in his letter: “Together , we will be a company with over $27 billion in sales and more than 64,000 associates worldwide. This combined entity will be, among other things, the world’s leading confectionery company, with the resources and critical mass to explore new geographies and categories that might have been beyond our reach in the past.”
In 1998, Daimler-Benz bought Chrysler for $37 billion
1998 was a big key moment for the automobile fans. Daimler-Benz–maker of the world known for its luxury cars announced $36 billion merger with the United States-based Chrysler Corporation.
The purchase of chrysler was considered to be of high importance and had set up high hopes for the automobile industry but fate didn’t turn out the way it should have been! Daimler according to Time magazine found it difficult to cooperate with Chrysler’s concern for heavy prices, and therefore in 2007 Chrysler was handed over to Cerberus Capital Management for $650 million.
In 1999, Exxon and Mobil merged in a deal worth $75 billion.
On November 30, 1999, Exxon and Mobil joined to form Exxon Mobil Corporation. “This merger will enhance our ability to be an effective global competitor in a volatile world economy and in an industry that is more and more competitive, ” said chairmen and chief executive officers of Exxon and Mobil, respectively. Though these words were said, nobody believed for this deal to work out well. The cultural differences of both companies being huge caused everyone everyone to show their concern. This reunion however resulted in the largest merger in US corporate history. The companies earned the biggest annual corporate profits in U.S. history, according to The Wall Street Journal. Where most mergers failed to show success and co-operation, The Exxon merger deal proved to be an exception setting standards for all future oil industry mergers.
All for now,