A lingering recession would seem like the opportune time to attempt a takeover. For some companies, acquisitions represent a way to stay alive and others a chance to grow. In the long run, timing was just not enough. Either the deal wasn't sweet enough or antitrust issues soured the plan. The following are four notable failed takeover attempts:
- Koenigsegg GroupAB Backing Away from Saab
The Swedish car maker is retracting its agreement to buy 100% of Saab stock from GM. This comes as a blow to GM. The sale was part of the company's bankruptcy restructuring plan. Now GM may be forced to shut down the lackluster brand. Saab is expected to sell less than 100,000 cars in 2009 and post a deficit - again. Who's impacted? Manufacturing workers with few new job opportunities; Saab car dealers who thought they were out of the woods when a prospective new owner surfaced; stockholders reeling from even more bad news - the new GM can't seem to catch a break.
- It Ain't Over 'Til It's Over for Kraft and Cadbury
British candy giant Cadbury told Kraft its $16 billion offer was just not enough. Kraft then attempted a hostile takeover offering a cash & stock deal to Cadbury stockholders. The latest turn in Kraft's attempt to buy Cadbury encouraged Hershey to jump into the mix. Hershey announced its interest in buying Cadbury on the company website November 18, 2009. Bryon Trott of BDT Capital is handling the Hershey Trust's possible offer. Cadbury shareholders are hopeful Hershey will force Kraft to re-evaluate how much it thinks Cadbury is worth. The whole situation is a mouth-watering confectionery drama.
- China Blocked Coke's Taste for Huiyan
Everybody wants a piece of the Chinese consumer market. Coca-Cola tried to enhance its presence only to be thwarted by China's Commerce Ministry. Coke's attempt to buy juice maker Huiyan caused antitrust concerns. Not to be discouraged, a few months later Coke posted a press release celebrated the opening of three new bottling plants for existing beverages in China.
- Facebook Couldn't Befriend Twitter
Even in the social networking world, cash speaks louder than "stated stock value." Facebook is privately held. Twitter's investors valued it at $98 million. When the proposal surfaced to purchase Twitter for $400 million of Facebook stock plus $100 million in cash, the two sides could not agree on just how much Facebook stock was worth. Valuing tech companies has never been an easy task and, in the environment of tight credit, stock was the only tool available to marry the social networking king with the queen of micro-blogging. The current wedding is off, but the two are said to be still dating.
Though a failed takeover doesn't necessarily pull a deal off of the table, it can complicate negotiations down the road. And as we've seen with the recent purchase of NBC by Comcast (in a deal worth $30 billion), anything is possible in the world of mergers and acquisitions.