The 10 Biggest Corporate Mergers and Acquisitions in History
The opportunity to see that the purchase of Activision Blizzard by Microsoft for nearly $69B is far from the Top 10.
Microsoft has just announced the purchase of the video game giant Activision Blizzard for $68.7 billion. This is a record amount for this sector. Until then, the most expensive acquisition in the video game industry was 12.7 billion dollars. This record was set just a few days ago when publisher Take-Two announced the acquisition of mobile game specialist Zynga.
The sector is in full swing, and the reason is simple: all the players want to strengthen themselves to be ready to take full advantage of the new field in which they will have to be in the years to come. This is of course the Metaverse.
Even for Microsoft, a giant with a market cap of over $2T, this acquisition is a record. Until now, the most expensive acquisitions of the Redmond firm had been respectively LinkedIn in 2016 for $26.2 billion, Nuance Communications in 2021 for $19.7 billion, and Skype in 20211 for $8.5 billion.
If the deal were to be approved by antitrust authorities in America and Europe, Microsoft would become the world's third-largest video game company by revenue, behind Tencent and Sony.
As impressive as the $68.7 billion figure is, I realized while doing extensive research that it doesn't even get this Microsoft acquisition into the Top 10 most expensive acquisitions in history.
Here is the Top 10 that will show you the excessiveness of some acquisitions. To give you some suspense, I will propose to you this Top 10 from 10th place to 1st place.
10. Exxon - Mobil: $85.1B
The merger of these two American oil companies gave birth in 1999 to the number 1 in the sector in the United States and one of the main oil and gas majors in the world.
Before their merger, Exxon and Mobil were two old “cousins”, descendants of the mythical American oil company Standard Oil Company founded by Rockefeller and his associates in 1870.
9. Pfizer - Warner-Lambert: $88.8B
The pharmaceutical sector is also known for its big moves. The biggest merger in this sector took place in the United States in 1999, when Pfizer, the world's number one pharmaceutical company, bought the Warner-Lambert laboratory (itself the result of a merger in the 1950s).
Warner-Lambert is renowned for having created Lipitor, an anti-cholesterol drug that was for a long time the best-selling drug in the world.
8. AT&T - BellSouth: $89.4B
Back to the roots for BellSouth in 2006. This local telecom operator in the United States was created in 1984 when the American regulator forced the historical group of the sector to separate from its regional activities. Twenty years later, BellSouth, which operates in the southeastern states of the country, was reunited with AT&T.
7. Royal Dutch Petroleum - Shell Transport & Trading: $95.4B
The British Shell Transport and Trading and the Dutch Royal Dutch oil companies were linked since 1907, although they had two separate headquarters. However, it was not until 2005 that the two companies were merged into a single legal entity, Royal Dutch Shell Plc. Today, the head office is in The Hague in the Netherlands but the entity is listed on the London Stock Exchange.
6. RFS Holdings - ABN Amro: $98.2B
The takeover of the Dutch bank ABN Amro by a consortium, for nearly 100 billion dollars in 2007, is the largest transaction in the history of the banking sector. The only one in the Top 10.
RFS Holdings is the combination of the banks Royal Bank of Scotland, Fortis, and Banco Santander, created for the occasion to carry out a takeover bid on ABN Amro and share its assets. This operation, which took place shortly before the subprime crisis in 2008, has above all weakened the three conquerors.
5. AT&T - Time Warner: $107.3B
This was the mega-deal of 2016, the 5th and last to exceed $100 billion. It took place in October 2016. The target was Time Warner! It was the incumbent telecom operator of the United States who grabbed it on this occasion.
4. AB Inbev - SABMiller: $110.3B
The beer giants have been very active since the early 2000s in the field of mergers and acquisitions. While the sector was historically very fragmented and subject to strong international competition, the big brewers have had to react to the rise in power of independent producers.
The acquisition of the English brewer SABMiller (itself the result of a merger between South African Breweries and Miller) by AB Inbev was approved in October 2016. This takeover is the latest in a long line: InBev came from the 2004 merger between Belgium's Interbrew and Brazilian brewer AmBev. In 2008, it was acquired by U.S.-based Anheuser-Busch Group, forming AB InBev.
The portfolio of beer brands of this group is now impressive: Budweiser, Corona, Stella Artois, Leffe, Hoegaarden, Fosters, and many others...
3. Verizon Communications - Cellco (Verizon Wireless): $130.3B
Verizon Wireless is a mobile telecom operator that was founded in 2000 in the United States. It was originally a joint venture between the American Verizon Communications (55%) and the British Vodafone (45%), whose name was Cellco Partnership. In 2013, Verizon bought out the shares it did not already own and with the acquisition of Alltel Wireless, it is now the largest mobile operator in the United States.
2. AOL - Time Warner: $181.6B
In January 2000, Gerald Levin, president of Time Warner, and Stephen Case, president of the Internet service provider, America Online, welcomed the merger of the two companies. Little did they know that this colossal merger, which saw the acquisition of a Hollywood studio flagship by a young Internet service provider, would also be one of the biggest failures in history.
Indeed, the deal was closed a few months before the Internet bubble burst and the new entity did not recover. In 2002, the new AOL recorded a loss of close to 100 billion dollars, another record! Finally, in 2009, the group separates from AOL and takes back its original name. But Time Warner will not be finished making news and arousing envy, as you saw with the buyout by AT&T at the end of 2016.
1. Vodafone AirTouch - Mannesmann AG : $202.8B
It was at the dawn of the 21st century, in February 2000, that the largest corporate acquisition in history took place. At the height of the Internet bubble, the valuations of telecom companies exploded.
The British company Vodafone AirTouch put its money where its mouth was to take over the German conglomerate Mannesmann AG, which had developed a flourishing telecom business in the 1990s. It will then get rid of the branches of this historical flagship of German industry that were not part of its core business.
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