The recent demise of MFI reminded me of my own tiny role in one long-forgotten episode in its corporate history: its doomed merger with a well-known supermarket chain.
The only tangible benefit of this short-lived mid-1980s alliance was that it spawned a half decent joke: “I don’t know about this Asda-MFI merger. I bought a chicken yesterday and, as soon as I got it home, its legs dropped off.”
My contribution was to be summoned to a leading merchant bank with my chairman one Sunday afternoon, where we found the happy newly-weds toasting each other with champagne, and started trying to construct a plausible story about the benefits of the get-together. It swiftly became apparent that none of the principals could help us, as they referred all our enquiries to the guru who had come up with the idea. He in turn told us, with disarming honesty, how much money his firm was making out of the deal.
Nevertheless, as dedicated professionals, we worked hard to come up with a plausible explanation and to coach our clients in it. How well this had worked was brought home to us when their response to the first question at the following morning’s press conference was “Well, it’s obvious, isn’t it?”
That was not the most unsuccessful merger in which I have been involved. The following year the proposed get-together of the textile companies Dawson International and Coats Patons fell apart before it could be consummated, after an even more disastrous press launch.
In fact, I cannot think of a single successful corporate marriage I have helped to publicise. Certainly not the 2000 merger of Iceland and Booker, which created the ill-fated Big Food Group, though Iceland itself has gone from strength to strength since obtaining a divorce in 2005.
Some would argue that the whole concept of a merger is flawed; the outcome is always a takeover by one party. Sadly most takeovers also fail to deliver the value expected from them, and even in the most successful instances one can usually argue that the same result would have been achieved, perhaps more slowly but with less grief, through organic growth.
But if everyone accepted that, how would bankers, brokers, lawyers and even PR men ever earn another bonus?
Keith Hann is a financial PR consultant with his own wedding to pay for, generating a wholly unaccustomed appetite for work.
www.keithhann.com
Originally published in The Journal, Newcastle upon Tyne.
You probably had to be there
6 years ago
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