The rate of success for mergers and acquisitions is well-known. Less than 20% of deals deliver the promised results. One in five chance of success. Virtually no one thinks they will fall into the failure bucket, though more than 4 out of 5 do.

The reasons people give for such optimism are varied, but include:

  • Superior financial analysis
  • Superior judgment
  • Excellent ability to read people
  • Industry knowledge

Good but not sufficient. It is impossible to know as much as you’d like not only because sellers want to put their best foot forward. Some aspects of a business are difficult to put on a spreadsheet or graph and indeed, the attempt to do so leads to over-simplification. In turn, this fuels over-confidence. Coupled with a sense of urgency that accompanies many a deal process, fear of losing what one has invested in the process and perhaps, losing face makes for a context that fogs the lenses considerably, even in the presence of good analysis.


There is no substitute for sober judgment and the ability to tolerate the stress of the process. Flare ups and squabbles at the top find their way into the fabric of a company later when everyone is asked to collaborate.

The Holcim-Lafarge merger is currently stalled and reports are the boards are squabbling over several issues. The issues are important but why is it in the news? The deal may be a good idea but when conflict rises up between the boards and makes it into the press, one has to ask if their lenses are a bit clouded?

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