Recent studies by Bain show that companies engaging in M&A activities have seen a significant increase in shareholder returns, with frequent acquirers earning 130% higher returns compared to non-acquirers. This challenges the conventional belief that acquisitions often destroy value, as data from the last decade indicates that acquiring firms have outperformed non-acquirers. The shift in performance trend from '12 to '24 suggests that M&A strategies have become more favorable for companies.
It still doesn’t cease to amaze me how much “conventional wisdom” only really applies to specific periods in time. Markets are always changing. There are advantages to using data as opposed to rules of thumb. https://t.co/kQV2rDFmoj
“Companies should focus on buybacks because M&A is bad and any management that pursues a growth strategy is only doing so out of a selfish desire to empire build” https://t.co/w7lzR5ECLM https://t.co/9YuDPTvLdX
🧵Conventional wisdom: "Acquisitions often destroy value". The data: "Acquiring firms outperform non-acquirers (last 10 yrs)". Take R3000, non-acquirers outperformed '99-'12 (conv wisdom), however there's been a shift from '12 - '24 where acquirers have outperformed. (2/n)👇 https://t.co/hXM6qeW4m8
M&A increases shareholder value!? https://t.co/X97rMSnlGh
Interesting study from Bain on M&A “Companies that were frequent acquirers earned 130% higher shareholder returns vs. those that stayed out of the market. Sitting on the M&A sideline is generally a losing strategy.” https://t.co/qAUHnxGcS7