When it comes to mergers and acquisitions, most stories focus on the glamorous side of things. They talk about the huge sums of money involved. They get into the prestigious backgrounds of the companies coming together. They outline what great expectations the board and the shareholders have for the new and hopefully improved company. However, the potential success of a merger often comes down to things that are a little more boring and pedestrian. Like, for example, company culture. When two companies come together, will their teams be able to work well together? And if not, then what?
In the 2010s, it seemed like everyone was getting in on mergers and acquisitions. Amazon bought Whole Foods, and no one knew quite what to expect. Pharmacy chains like CVS started to poke around in the world of health insurance by acquiring brands like Aetna. One famous recent example of a mega merger is the transaction between Disney and Fox, which wasn’t completed until 2019. These companies each have a great pedigree in the world of entertainment. Their approaches to that business, however, have been very different.
For example, Disney has long sold itself as a very family-friendly entity. Some of Fox’s offerings have been much more brash. When its long-running show The Simpsons debuted in the late 1980s, it was seen as outrageous. So, too, was Married With Children. Fox’s approach to its back catalog was also different. Disney creates an air of exclusivity by putting properties into its vault. Rather than allowing them to remain in print and available, the company only re-releases them periodically, often on anniversaries. Fox, by contrast, has done things differently. Some of Fox’s older films have become mainstays at summer drive-ins, film festivals and midnight showings at second-run theaters. Now that Disney has control, that’s changing. It seems they’re taking the vault approach with their newly acquired films, too.
When two big corporations come together, there’s always some duplication and some layoffs in support departments. What’s important is to find a way forward with the personnel in key departments that go to the company’s mission. Amazon and Whole Foods have been able to do that, and so far everyone’s winning. Hopefully, Disney and Fox can, too.