Prior Strategy Processes as a Key to Understanding Mega-mergers:: The Novartis Case

Abstract

Given that the majority of large mergers does not meet expected results, it is imperative to assess ex ante to what extent a merger concept can be realised in the market environment. The merger concept is usually the result of a not immediately transparent process of negotiation between the management bodies of the merging firms. It remains difficult for researchers to study these negotiation processes with first-hand information. The Novartis case study shows that the merger concept is closely aligned to previous strategy processes of the merging firms. Conducting a longitudinal multilevel analysis focused on resource allocations the authors introduce a new way to explore intra-organisational strategy processes using publicly available information.