Merger - how companies prepare for it: case studies of Cloetta Fazer and CashGuard Group

Abstract: Mergers are an increasing phenomenon mainly due to increasing globalization
and market competition. Previous research - reporting a high failure rate
among mergers - have concentrated on the factors that cause failure or
insure success during integration and post merger phases. The purpose of
this thesis is to gain a better understanding of the conditions companies
should fulfill in the pre-merger phase with the aim of ensuring merger
success. Procedures and criteria, as well as role of organizational culture
in partner selection were studied through two case studies dealing with
mergers of Cloetta Fazer and CashGuard Group.

Findings showed that the companies in their pre-merger phases satisfied the
conditions leading to a successful merger, even if their ways to success
looked different. Regarding the procedure and criteria for selecting a
merger partner, our findings generally supported theory, even though Cloetta
Fazer and CashGuard Group operate in different industries. When regard to
the role of organizational culture and its impact on the pre-merger phase,
we found that Cloetta and Fazer had different organizational cultures, while
CashGuard and Security Qube System AB (SQS) did not. However, neither of
the two companies did a cultural due diligence, as both Cloetta Fazer and
cashGuard Group had production collaboration with their merger partners
prior to the actual merger.