MERGERS & ACQUISITIONS IN ELEVATOR INDUSTRY: THE ROLE OF ICTs TO AVOID
INFORMATION ASYMMETRY
Abstract
Mergers and Acquisitions operations continues to be one of the most
explored growth strategies globally in all markets, and also in the
Elevator Industry. Volume of investments grows year after year. It is
the fastest way to grow in international and domestic markets, but the
reality is that a high percentage of the operations carried out do not
meet the expectations of the investors when the integration phase,
called the post-acquisition phase, has been completed. There are several
causes of failures on mergers and acquisitions processes, such as lack
of commitment from the management, unrealistic business plan, cultural
shock, etc … But the most common and the one with the highest
risk in an acquisition decision, is the asymmetry of information. During
the negotiation phase a large amount of data is collected, and
subsequently analyzed during the Due Diligence period, but does not
correspond to reality during the integration phase. That is, the
information that the seller has provided, and has been studied and
analyzed to take a decision of acquire by investors, has not been the
real and complete one. In this article we will propose how the asymmetry
information can be avoided by the application of Information and
Communication Technology (ICT) through the IoT of the elevators. Same
can be applied to other industries.