According to David Ravenscraft and Mike Scherer’s study, many acquisit

QUESTION

According to David Ravenscraft and Mike Scherer’s study, many acquisitions destroy rather than create value.

Indicate whether the statement is true or false.

ANSWER

TRUE
In a seminal study of the post-acquisition performance of acquired companies, David Ravenscraft and Mike Scherer concluded that, on average, the profits and market shares of acquired companies declined following acquisition. Ravenscraft and Scherer’s evidence suggests that many acquisitions destroy rather than create value