29 July 2022
Understanding and Managing Mergers and Acquisitions
Many executives say they use M&A (Mergers & Acquisitions) as a means to consolidate or expand the market position or increase its production efficiency. Most mergers and acquisitions, however, fail to create value, leading to the so-called ‘merger paradox’. By adopting a multidisciplinary and institutional perspective, this course aims to increase the understanding of merger determinants and effects. This course deals with the economic, legal and financial aspects of Mergers & Acquisitions (M&A).
According to the merger market, the global M&A deal volume reached a 7-year high of $934.2 billion in the second quarter of 2014, resulting in a 64%-increase compared to the same period last year and a 70%-increase compared to the second quarter of 2012 (Bloomberg M&A Financial Advisory League Tables, 2014). Major M&A transactions often appear in the headlines of newspapers. Notable examples for this are the unfriendly takeover bid of Mexico’s América Móvil for the Dutch telecom provider KPN as well as Apple’s successful acquisition of Beats Electronics, a company partly owned by the famous rapper Dr. Dre. Moreover, many executives deal with smaller M&A transactions on a daily basis. Many of these executives would tell you that they use M&A as a way to consolidate or expand the market position of their firms or to increase their efficiency. Yet, most mergers and acquisitions repeatedly fail to generate economic value. This is what some experts call the ‘merger paradox’.
The explosive growth in the number, size, and complexity of mergers and acquisitions during the latter part of the 1990s and between 2003-2008 has demonstrated how ingrained this way of doing business has become in the global business community. Interestingly, an M&A outburst is always followed by a similar move, but in the opposite direction: downwards. Many acquirers subsequently pursue spin-offs or split-ups. These dynamics form the frame of a course that contributes to understanding the position of firms as well as authorities.
Merger markets in times of Covid-19 are as various as never before. While prominent companies like Google Cloud, Nestle SA and Boohoo have announced their openness for acquisition, others appear to be the reason of a current "stop" in the emerging markets. The economic pressure reflected from postponing the deal activity between acquisitions and followed to late stage operations and final transactions. But on the other hand, the time of Covid-19 crisis gave an opportunity for companies to headhunt for benefits and win bids. But what is happening on the markets in terms of new strategic objectives and their barriers? What is the result of comparison of previous capabilities and expected volumes for the nearest future? Which are the legal consequences of the Covid-19 crisis for M&A contracts?
The M&A course will provide its participants with answers to these questions and make a good introduction into the world of merger market as well as a discussion on the topic of Material Adverse Change (MAC) clauses.
Below you can find a trailer for this course. In addition, we have made a taster available for this course. See: https://www.youtube.com/watch?v=wYC5RxfeuAQ.
Prof. dr. Wilco J. Oostwouder
Bachelor and Master students with an interest in Law & Economics. Ph.D. students and young professionals are also welcome to apply.
To equip students and young professionals with an insight into the background and development of key issues of M&A, relevant transaction documents and valuations. In addition, participants will acquire valuable negotiation skills as well as learn how to draft acquisition proposals. This course is also an excellent introduction to the course ‘Mergers, Acquisitions and restructuring’ in the LLM/MSc “Law & Economics”/’Economics & Law’ programs at Utrecht University.
EUR 675: Course + course materials