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In the Managing International Acquisition simulation dealt with the merger and acquisition of a foreign national bank overseas. In doing the research for this project, I found interesting examples of recent mergers of Reebok/Adidas, Nextel/Sprint, and MBNA/Bank of America.
The Reebok/Adidas merger is all about catching Nike, the industry leader in market share. The objective of the tieup is clear. The two companies, which jockey for No. 2 and No. 3 slots behind Nike (NKE ), view their prospects for competing against the Beaverton, Ore., behemoth as better together than apart. (www.businessweek.com)
In Europe especially, the shadow of Nike grew larger in the last year as the U.S. company surpassed Adidas in the soccer shoe segment for the first time -- for Adidas, a game-changing event equal to, say, Toyota (TM ) surpassing Ford (F ) in U.S. sales. (www.businessweek.com)
In the U.S., Nike reigns supreme. In 2004, it had about 36% market share in the athletic-footwear market, according to the Sporting Goods Manufacturers Association International, while Adidas has 8.9% of the U.S. market and Reebok 12.2%. The U.S. ranks as the world's biggest athletic-shoe market, accounting for half the $33 billion spent globally each year on athletic shoes. (www.businessweek.com)
It is clear that this merger is a product of both companies desperation to catch Nike and surpass their market share. Instead of cutting into each others shares and profits, the two companies uniting in this cause stands a better chance to catch Nike.
Nextel and Sprint merger was the most surprising merger that I have been aware of in my young life. The two companies are no where near alike. Nextel ...