Two events are supposed to be holding back the launch of mega-mergers: the UK’s exit from the European Union; and the US presidential election.
Then again, maybe not.
Last week fags maker British American Tobacco plc (LON:BATS) moved to stop wags asking when it was going to change its name to British Tobacco by launching a £38bn bid for US sector peer Reynolds America, and this week US phone giant AT&T Inc (NYSE:T) has offered US$85bn in a mixture of shares and cash for the CNN and HBO owner, Time Warner.
When it comes to Time Warner, it is best to be a bit circumspect about mergers. This is the company that pulled off – if “pulled off” is a synonym for the phrase “utterly botched” the “deal of the century” when it merged with internet colossus, as it then was, AOL (ask your grandfather), right at the height of the dot.com boom.
It was a US$164bn deal that redefined the laws of arithmetic, so that two plus two equalled one.
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SOURCE: Proactive Investors
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