Word: mergerism
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...dismissed Kraft's bid as too low, but speculation is running rampant on Wall Street that Cadbury is now in play and that either Kraft will sweeten its offer or another rival, such as Hershey, will step up. Industry experts speculate that bidding could exceed $21 billion before a merger is clinched. Read "Chocolate, Meet Choco-Luxe...
...Leary and Perik sold the firm, which they renamed the Learning Company, to Mattel in 1999 for $3.6 billion. But almost immediately the deal turned sour. The Learning Company lost $200 million in the second half of 1999 alone. O'Leary and Perik, who joined Mattel after the merger, left the toy company six months later in a management shake-up. In 2001, Mattel disposed of the Learning Company by giving away most of the division to a private-equity firm for free...
...defendants. In the complaint, the shareholders alleged that under O'Leary and Perik the Learning Company used "accounting manipulations" to gain market share and drive up the company's stock price. According to the suit, a sales manager at the Learning Company at the time of the Mattel merger told employees that he "suspected the 'Learning Company is broke' and is 'cooking the books.' " Mattel paid shareholders $122 million to settle the suit. O'Leary and Perik settled as well. O'Leary did not return multiple calls for comment. In the past, O'Leary has blamed the problems...
...margins, Cadbury has an earnings potential that looks healthy. Having spun off its troublesome drinks business in 2008, it saw its profits and margins both rise in the first half of this year. Nor is there much concern about Kraft's being able to pull off such a merger. Deals involving a large firm's acquisition of a significantly smaller one - revenues at Kraft are more than four times those of Cadbury - are "the deals that have tended to work," says Martin Deboo, an analyst at Investec Securities in London. "It makes perfect sense for Kraft to acquire Cadbury," Sanford...
...merger with Porsche could help VW in the U.S. While Porsche may be a niche sports car maker, it's better known stateside than VW's other premium brand Audi and could add to VW's sex appeal with brand-conscious U.S. consumers. "VW's image in the U.S. could benefit significantly from Porsche," says Jürgen Meyer, a fund manager with SEB Asset Management in Frankfurt. "Americans don't know Audi, but they know Porsche as a premium brand and that will rub off on VW. They could possibly use the Porsche brand name to create a group...