The Seedpod — Ep 6: When Mergers and Acquisitions Come in Droves
A podcast from the published January 11, 2016.
According to data gathered by Thomson Reuters, 2015 was a banner year for mergers and acquisitions (M&A), generating $4.7 trillion in announced deals. It’s no surprise to those of us in agriculture, who witnessed a wave of mergers, including the surprising union of Dow AgroSciences and DuPont Pioneer.
“You have to start by realizing M&A is constant, because change is constant,” says Verdant Partners’ Thomas (Bud) Hughes, in this episode of the SeedPod. “Businesses are continually shuffling the deck and looking at how to diversify their risks versus their opportunity.”
On why mergers seem to come in droves, Hughes says “some of it’s just pure egos and follow-the-leader mentality.” It can also be a subject of timing, he says, when commodity prices have changed the profit and loss statements of companies, to encourage them to share or amass resources.
But sometimes these big deals can prove a distraction, says Hughes, giving small companies a chance to take an anticipated advantage of the circumstances.