Why do the majority of merger and acquisitions fail?

Abstract: In the last decade, there has been a great increase in the number of mergers and acquisitions all over the world. This enhancement of the number of transactions is included in the most of the previous studies but moreover, many of these studies show that the majority of the mergers and acquisitions fail in the objective of creating value for the shareholders. This failure ratio is the reason which leads us to the next research question: why do the majority of mergers and acquisitions fail? In this study, we introduce the basic concepts that must be known before answering the research question and the reasons that other authors have pointed out for explaining this failure ratio. After this theoretical background, we conduct a comparative research of four cases, some of them with a successful result and some others with a failure one, in order to determine the key factors that explain the reasons why some of the mergers and acquisitions fail or success. The study shows that there is a wide range of features when determining this failure or success. The analysis of the four case studies indicates that most of the reasons for this failure or success were previously considered by other authors, but some new reasons will be presented.