It is the aim of the present dissertation to identify and evaluate reasons, which led M&A fail in order to develop a strategy to design such processes more secure. The well-known liaison between BMW and Rover will be used as an example for failing M&A and will accompany this dissertation. After a brief introduction, containing definitions, a historical overview and motives and objectives of M&A this work provides an investigation of both Due Diligence and Post-Merger-Integration. Additionally, the author will clarify the way of data collection, the objectives and the design of his research in a Methodology chapter. Subsequent to the Methodology, a chapter discussing the author’s findings of the Due Diligence and the Post-Merger-Integration concerning BMW and Rover will follow. The last point of the present dissertation is a chapter containing Conclusions and Recommendations in which the author provides his point of view of the BMW and Rover case and his strategy with regard to M&A in general.
Table of Contents
1. Introduction
1.1 Conceptual formulation
1.2 Definitions of relevant terms
1.3 The Structure of the Dissertation
1.4 Historical background of M&A activities
1.5 Motives and objectives of mergers and acquisitions
2. Due Diligence
2.1 Explanation of the term ‘Due Diligence’
2.2 The content of a ‘Due Diligence’
2.2.1 Market and Commercial Due Diligence
2.2.2 Cultural Due Diligence
2.2.3 Human Resource Due Diligence
3. Post-Merger-Integration Management
3.1 Definition of the term ‘Post-Merger-Integration Management’
3.2 Strategy of integration
3.3 Aims/objectives of integration and success factors
3.4 Implementation of Post Merger Integration
3.4.1 Organizational oriented integration
3.4.2 Personnel oriented integration
3.4.3 Cultural oriented integration
4. Methodology
4.1 Introduction
4.2 Research Design
4.3 Methods
4.4 Limitations
Discussion of the findings
Conclusion and Recommendation
Bibliography:
Research Objectives and Key Topics
This dissertation examines the factors contributing to unsuccessful mergers and acquisitions, using the attempted takeover of Rover Ltd. by BMW AG as a central case study. The primary goal is to evaluate why these processes fail and to develop recommendations for creating more secure and successful integration strategies.
- The role and implementation of Due Diligence in M&A.
- Post-Merger-Integration (PMI) strategies and management.
- The impact of 'soft keys' such as organizational, cultural, and human resource factors.
- Analysis of the BMW-Rover acquisition as a case study.
- Methodological approach to qualitative research in business studies.
Excerpt from the Dissertation
1.4 Historical background of M&A activities
Since the middle of the 1990s, the world economy has experienced an unprecedented number of mergers. This enormous amount of mergers and acquisitions can be identified as a ‘Merger Wave’ (Franz 2002 p. 27). From 1990 to 2000 the number of mergers and acquisitions has more than tripled and the transaction volume increased by a factor of 12 (Figure 1). The temporary peak of merger and acquisition activities was reached in the year 2000 but the merger wave has not entirely come to an end today. Figure 2 shows that the M&A activity in the automotive industry decreased from 2002 to 2003 in number of transactions but not in deal value (www.pwcglobal.com). Coming back to the already mentioned merger waves, we have to add that the current wave is the fifth of five more or less distinct waves over the past 100 years (Franz 2002 p. 28).
The first merger wave occurred from 1897 to 1904. It basically reflected the industrial revolution that enabled the exploitation of high economies of scale by the development of the steam engine and the emergence of heavy industries. It led to the establishment of large industrial trusts, which are still prevalent in the old economy of the United States and elsewhere. This first merger wave was characterized by horizontal mergers and acquisitions (www.uni-kiel.de).
Summary of Chapters
1. Introduction: Outlines the research scope, defines key M&A terminology, and provides a brief historical context of merger waves.
2. Due Diligence: Investigates the information gathering process, focusing on Market, Cultural, and Human Resource aspects rather than just financial 'hard keys'.
3. Post-Merger-Integration Management: Discusses the high-risk integration phase, exploring various strategies and the critical role of organizational, cultural, and personnel alignment.
4. Methodology: Details the research design, justifying the use of a qualitative, inductive case study approach using secondary data.
Discussion of the findings: Evaluates the specific failures in the BMW-Rover case, linking them to deficiencies in Due Diligence and Post-Merger-Integration.
Conclusion and Recommendation: Summarizes the lessons learned and provides strategic advice for future M&A success, emphasizing long-term planning and cultural integration.
Keywords
Mergers and Acquisitions, M&A, BMW, Rover, Due Diligence, Post-Merger-Integration, PMI, Corporate Culture, Market Power, Diversification, Business Risk, Human Resource, Integration Strategy, Synergy, Case Study.
Frequently Asked Questions
What is the core focus of this dissertation?
The dissertation examines the nature of unsuccessful mergers and acquisitions, specifically using the failed acquisition of Rover Ltd. by BMW AG to identify why such transactions collapse.
What are the central thematic fields?
The main themes include the pre-merger information gathering process (Due Diligence) and the critical post-acquisition implementation phase (Post-Merger-Integration).
What is the primary research objective?
The goal is to analyze the causes of failure in the BMW-Rover case and to provide a strategic framework for managing future M&A processes more securely.
Which scientific methodology is used?
The author employs a qualitative, inductive research approach, utilizing secondary data analysis and a detailed case study to draw conclusions.
What does the main body of the work cover?
It covers the definition and content of Due Diligence, the strategies for Post-Merger-Integration, and a critical look at how cultural and HR factors influenced the BMW-Rover outcome.
Which keywords characterize the work?
Keywords include Mergers and Acquisitions, Due Diligence, Post-Merger-Integration, Corporate Culture, and Synergy, among others.
Why did the BMW-Rover acquisition fail according to the author?
The author suggests the failure was largely due to poor integration management, an inadequate understanding of cultural and personnel factors, and a flawed stand-alone integration strategy.
What role does 'Cultural Due Diligence' play in the study?
The study highlights it as a critical but often neglected process that can prevent 'culture clashes' which lead to high employee turnover and integration failure.
- Quote paper
- B.A. Sebastian Meyer (Author), 2004, An examination of the nature of unsuccessful M&A as illustrated by the attempted BMW AG and Rover Ltd. acquisition, Munich, GRIN Verlag, https://www.hausarbeiten.de/document/76625
