It is a long-held semiconductor industry tenet that mergers and takeovers don't work. Here are the ten worst performing mergers in the industry's history.
The merger of AEI Semiconductors and Marconi-Elliott Semiconductors into GEC Semiconductors.
United Technologies' takeover of Mostek
Schlumberger's takeover of Fairchild.
The mergers of GE Semiconductor, Harris, Intersil.and RCA Semiconductor.
Lattice Semiconductor's takeovers of the programmable logic businesses of Agere Systems and AMD
Intel's $10 billion purchase of telecoms IC companies in 1999/2000/2001
Mitel's takeover of Plessey Semiconductors
Texas Pacific Group's takeover of Zilog
AMD's takeover of ATI Technologies
A bit basic isn't it? No reason has been given as to why these were bad ideas.
There's only one measure of a cocked-up M&A: they all massively destroyed value
David,
I agree with your list, but you should also add Conexant's binge (and later purge)of M&As.
Thanks Will, you're absolutely right, Conexant should be there.
David
At the risk of being pedantic, No. 1 and No. 8 on your list are actually linked by another two less than successful acquisitions - firstly the Plessey Semiconductors takeover of Ferranti Semiconductors (later more successfully devolved into Zetex without Plessey having derived any tangible benefit from it), and – in my opinion the worst one of all – the 1989 GEC-Siemens takeover of Plessey that resulted in its merger with No.1 to form GEC-Plessey Semiconductors. GPS was itself later taken over – as you stated – by Mitel.
I admit to being a tad biased here, as this latter one put me out of a job at the time!
At the risk of being even more pedantic, I'd say the 30 year gap between events No.1 and No.8 is a very long time to be designated a 'link'.
I do think 1 & 8 were a lot more destructive than the takeovers of Ferranti and Plessey by GEC.
GEC-Plessey Semiconductors did OK for quite a while, and Zetex certainly thrived after being hived off to become a separate company.
The big value destruction only came after Mitel took it over.