How mergers go wrong

THEY are, like second marriages, a triumph of hope over experience. A stream of studies has shown that corporate mergers have even higher failure rates than the liaisons of Hollywood stars. One report by KPMG, a consultancy, concluded that over half of them had destroyed shareholder value, and a further third had made no difference. Yet over the past two years, companies around the globe have jumped into bed with each other on an unprecedented scale. In 1999, the worldwide value of mergers and acquisitions rose by over a third to more than $3.4 trillion. In Europe, the hottest merger zone of all, the figure more than doubled, to $1.2 trillion.