The €8 Billion Bet. When Swisscom Went All-In on Italy's Most Brutal Market Through the Acquisition of Vodafone Italia

Swisscom CEO Christoph Aeschlimann and Vodafone Group Margherita Della Valle

In December 2024, the Swiss telecommunications incumbent Swisscom completed its acquisition of 100% of Vodafone Italia for €8 billion, and merged it with its local subsidiary Fastweb. This deal created Italy's largest mobile operator by subscriber count and its second-largest fixed-line provider.

Fastweb held strong fixed-line fiber assets but operated as a junior mobile player on borrowed network capacity. Vodafone Italia commanded 20 million mobile customers and Italy's most awarded mobile network, yet was hemorrhaging value in a brutal price war. The strategic rationale was clear: fixed plus mobile equals convergence, convergence equals reduced churn, reduced churn equals margin expansion. But the execution risks remain equally real: in 2016, the Wind-Tre merger offered a similarly coherent thesis and projected significant synergies, yet failed in this exact market

Can this deal, which makes strong sense by the standard M&A playbook, survive contact with operational reality?

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The Context

Italy's telecommunications market, the eurozone's third-largest by revenue at approximately €25 billion, was served until late 2024 by the same core group of operators across both mobile and fixed-line segments, though in different proportions. On the mobile side five operators competed: WindTre at 24.0%, TIM at 23.5%, Vodafone Italia at 21.0%, Iliad at 14.6%, and Fastweb at 4.7%. Four of these held near-equal positions between 14% and 24%; Fastweb was a marginal fifth player (AGCOM data, Q3 2024, measured by "human SIM" market share). On the fixed-line side, four operators competed (Iliad had virtually no fixed-line presence): TIM dominated at roughly 40%, followed by Vodafone at 15.6%, WindTre at 14.3%, and Fastweb at 13.1%.

Fastweb, Swisscom's Italian subsidiary since 2007, operated the country's second-largest fixed-line fiber network but its 3.4 million mobile subscribers relied on third-party MVNO arrangements. Vodafone Italia ran Italy's most awarded mobile network (Opensignal, November 2024) with 20 million customers, but had no owned fixed-line infrastructure. Vodafone Group was reshaping its European portfolio, having also sold Spain to Zegona for €5 billion, to concentrate on stronger markets.

This market structure creates two interrelated problems.

The first is a pricing death spiral. In microeconomics and game theory, an oligopoly with near-equal players creates defection incentives: each player's most rational move (cut prices to capture share) triggers retaliation, collapsing everyone's margins. Without consolidation (or an illegal cartel), the cycle has no stopping point unless one player becomes large or differentiated enough to anchor pricing. Deutsche Telekom (over 40% in Germany) and Orange (France) play that role. Italy never developed such an anchor: its top four mobile operators held between 14% and 24% each. The result was sustained erosion of ARPU (Average Revenue Per User), the most watched profitability metric in telecommunications.

The second is a convergence gap. Convergence means a single operator delivering both fixed-line and mobile services through owned infrastructure, as an integrated product. Bundled customers are stickier (switching means changing everything) and generate higher ARPU. In Germany and France, incumbents offer this. Italy had no operator capable of it at scale: an SME needing broadband, employee mobile, and IoT under one contract had to manage multiple providers. TIM came closest but carried €26.6 billion in net debt (pre-NetCo sale). WindTre had a limited fixed-line footprint. Iliad had virtually none.

These two problems are connected. The pricing death spiral persists partly because no operator can escape price-based competition by offering something structurally different. Convergence would provide that escape route.

The Deal

This deal did not promise to fix Italy's structural fragmentation. The combined entity at 26.1% mobile share is the largest by subscribers but not by the margin that anchors pricing discipline (Deutsche Telekom holds north of 40%). The core promise is asset complementarity: creating the first Italian operator capable of selling a genuine fixed-mobile bundle at national scale, from owned infrastructure on both sides, giving one player a way to compete on value rather than price alone. Convergence does not end the price war; it gives one player a way to partially step outside it.

The transaction was a 100% cash acquisition for €8 billion. Vodafone Italia reported €4.2 billion in service revenue and roughly €1.05 billion in Adjusted EBITDAaL for FY2024 (ending March 2024), implying a 7.6x LTM EV/EBITDA and sitting at the upper end of the 5-7x range typical for mature European telecom operators, reflecting the convergence premium. Financing was entirely new debt, doubling Swisscom's net debt and pushing leverage from 1.5x to 2.6x Net Debt/EBITDA (FYE 2025). Also, a separate brand license permits continued use of the Vodafone brand in Italy for up to five years, alongside Fastweb.

Christoph Aeschlimann, Swisscom’s CEO since June 2022, leads the combined group from Bern, while Walter Renna was appointed CEO of the Italian entity, Fastweb + Vodafone. Swisscom’s credibility rests on its nearly two-decade track record in Italy: since acquiring Fastweb in 2007, it has grown the subsidiary’s customers, revenues, and EBITDA by over 50%. Margherita Della Valle, Vodafone Group CEO, accepted Swisscom's €8 billion offer, well below Iliad's €11.25 billion bid for the unit in 2022. Two years of continued value erosion likely explained the discount, but it was a clean break from a market Vodafone could no longer afford to stay in.

The Case For

The commercial case rests on convergence as a competitive weapon. The combined entity is the first Italian operator capable of offering an integrated fixed-mobile bundle at national scale, targeting customers (especially enterprise) who value integrated service over the cheapest SIM. For an Italian SME, this means broadband, employee mobile plans, and IoT connectivity under a single contract and a single bill, something no other operator could offer from owned infrastructure. Simultaneously, cost synergies from merging two networks lower the cost base. A more defensible revenue stream from bundling, combined with lower costs from consolidation, produces an operator that can sustain investment in a market that punishes sub-scale, single-product players. That is the bet.

Swisscom projects €600 million in annual run-rate synergies, primarily from migrating Fastweb's mobile customers onto Vodafone's owned network (eliminating MVNO costs), consolidating procurement, and removing overhead, at an upfront cost of up to €200 million. The target is weighted toward cost reduction, the category empirical research identifies as more reliably achievable.

The Case Against

Merging two telecom operators requires unifying spectrum portfolios, radio access networks, billing platforms, customer databases, and retail channels. The specific vulnerability: Fastweb's 3.4 million mobile customers must migrate from third-party MVNO arrangements onto Vodafone's owned network, involving SIM reprovisioning, number portability, and meaningful attrition risk.

The most cautionary precedent sits in this same market. In 2016, 3 Italia and Wind Telecomunicazioni merged to form WindTre with projected €700 million in synergies. Then Iliad entered Italy in 2018 (acquiring spectrum the Commission required WindTre to divest) and launched aggressive price competition. A €6.6 billion 5G auction drained balance sheets. WindTre shed customers steadily. A 2023 Light Reading analysis described it as a merger that "went rotten." Fastweb + Vodafone has converged assets WindTre never possessed, but the precedent calibrates expectations.

The leverage position adds a specific constraint. Swisscom is a 51% state-owned company that chose to finance this acquisition entirely through debt, roughly doubling its net debt in a market with a track record of destroying operator value. At 2.6x Net Debt/EBITDA, the balance sheet is manageable but leaves limited margin. If synergy realization is delayed or integration disruptions cause customer defection, the deleveraging path narrows and Swisscom's dividend commitment could come under pressure.

The competitive response is predictable. Iliad, which twice sought to acquire Vodafone Italia (2022 and 2023), is the most directly threatened. A converged rival undermines its core strategy of attracting mobile-only customers on price. The likely response, more aggressive pricing or a push into fixed-line, could intensify the very price war the convergence thesis is designed to escape.

Politically, Swisscom's 51% Swiss government ownership creates an expectation that its mandate is domestic infrastructure. The Swiss People's Party opposed the deal, and 67% of voters opposed full privatization in a July 2024 poll. If integration struggles, political pressure to redirect capital to Swiss operations could constrain management at the worst moment.

Reflections for Business Leaders

For us at Glenshore, three dimensions that standard M&A playbook deal assessment tends to underweight will likely determine whether this transaction succeeds or fails.

The first concerns strategy versus anthropology. Telecom organizations develop deeply embedded cultures around network operations, field engineering, and customer service: ritualized daily practices, not abstract "cultural differences." Fastweb was a challenger (agile, fiber-focused), Vodafone Italia a conglomerate division (process-heavy, brand-conscious). Integration forces a choice about which tribe's rituals prevail and generates resentment in the tribe whose rituals are retired. The five-year Vodafone brand license buys time, but operating under multiple identities for half a decade creates ambiguity that compounds in both customer-facing interactions and internal decision-making.

The second distinguishes between what mergers reliably deliver and what they rarely achieve. Tangible asset synergies (network rationalization, procurement, overhead) are engineering problems with quantifiable solutions. Intangible capability transfer (a differentiated product, retaining Vodafone's engineering talent, preserving Fastweb's speed) determines whether a deal creates lasting advantage or temporary savings. Wind-Tre is instructive: cost synergies were partially captured, but brand trust and customer loyalty degraded faster than the cost base shrank. The question for Fastweb + Vodafone is whether the combined entity can build a converged product experience that customers recognize as genuinely different, not just two companies sharing a back office. The synergies most worth pursuing are the ones least amenable to a spreadsheet.

The third concerns timeframe and accountability. The appropriate evaluation window is 2028. The ultimate measure is not deleveraging or dividend targets but whether the acquisition strengthened the competitive position of both Swisscom and the Italian market, whether consumers gained better services, and whether the combined workforce emerged with a coherent identity. The acquirer inherits not just assets but obligations: to customers, employees, and a market whose health depends on the combined entity's conduct.

Swisscom's nearly two-decade track record at Fastweb provides reason for cautious optimism. The industrial logic is sound, the financing disciplined, the regulatory path cleared. The convergence bet has a strong foundation, but the real test remains in addressing the cultural differences between the two very different organizations, realizing intangible synergies beyond the spreadsheet, and meeting long-term obligations to customers and the market. That will determine whether Fastweb + Vodafone becomes the converged challenger its architects envisioned, and whether rivals like Iliad and WindTre are forced to converge… or concede.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.

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Disclaimer: The analysis contained herein reflects publicly available information as of February 2026. All data points are sourced from official Swisscom disclosures, AGCOM regulatory filings, Vodafone Group announcements, and referenced third-party research. No proprietary or non-public information has been used.

George Lucas and Lucasfilm Succession: A Cautionary Tale of Mergers and Acquisitions

George Lucas, Founder and Former CEO of Lucasfilm

In October 2012, The Walt Disney Company acquired Lucasfilm, the production company behind the Star Wars and Indiana Jones sagas, from founder George Lucas for $4 billion. It remains one of the most high-profile M&A deals in entertainment history.

Lucas was a pioneering filmmaker who had built an independent empire. He intended the exit as a deliberate handover to ensure his creations endured beyond his lifetime.

The transaction delivered extraordinary early financial returns for both parties. However, the honeymoon didn't last long. Worse, it also delivered something Lucas had not foreseen: the pain of watching strangers dismantle the creative vision he had spent a lifetime constructing. Despite the aid of sophisticated lawyers, top-tier M&A advisors, and seasoned business leaders, Lucas saw his legacy wiped out.

His public expressions of seller’s remorse offer a cautionary tale for all conscious business leaders contemplating an exit.

Listen to a discussion inspired by this article on the Glenshore Perspectives podcast.

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A Financial Empire, a Rebel Spirit, and a Global Cultural Force

Born in the 1940s in California, USA, George Lucas initially studied anthropology, sociology, and literature before a near-fatal car accident ended his racing ambitions and redirected his focus toward filmmaking. In 1969, he co-founded the film production company American Zoetrope with Francis Ford Coppola in San Francisco, aiming to foster independent filmmaking outside the constraints of Hollywood. His first movie THX 1138 was distributed by Warner Bros, but the studio heavily edited the film against Lucas's wishes. Disillusioned by this loss of creative control, he founded Lucasfilm in 1971 to ensure independence and prevent any studio from dictating the final cut of his work again.

In 1973, his breakthrough movie American Graffiti was produced for just $777,000 and grossed roughly $140 million worldwide. In 1977, Lucas directed Star Wars: A New Hope. Produced for $11 million, it generated $775 million worldwide during its original run and re-releases ($3.5 billion in 2026, adjusted for inflation).

Lucas made decisions that changed the entertainment industry. For Star Wars, he negotiated with distributor 20th Century Fox a reduced director’s fee in exchange for merchandising and sequel rights, initiating the modern franchise model. Toy company Kenner sold more than 300 million Star Wars action figures from 1978 to 1985 alone. Lucas also established multiple subsidiaries: Industrial Light & Magic for visual effects (creating effects for E.T., Jurassic Park, and Terminator 2), Skywalker Sound for audio standards (creator of the THX System), and the Lucasfilm Computer Division (sold to Steve Jobs in 1986, becoming Pixar). By 2012, Lucasfilm employed about 2,000 people, and the Star Wars brand had generated an estimated $27 billion in revenue, with merchandise accounting for the majority.

Beyond finances, Star Wars also had a major impact on global culture. It revived the space opera genre, elevating it from pulp science fiction to epic galaxy-spanning storytelling. Its narrative core lies in Joseph Campbell's universal template of departure, initiation, and return from the book The Hero with a Thousand Faces (the journey from farm boy to Jedi hero). The saga draws from the chivalric code of King Arthur (Jedi as knight-monks) and the samurai code of Bushido (the ethos of loyalty, discipline, and moral integrity). It incorporates elements of Taoism (the flow of universal energy), Buddhism (fear leads to anger, anger to hate, and hate to suffering), Christianity (redemption and sacrifice), and even Zoroastrianism (dualism of light and dark) and Gnosticism (the emphasis on spirit over physical form). It also drew inspiration from Japanese director Akira Kurosawa’s samurai films, especially The Hidden Fortress (with its villain, fleeing princess, peasant perspectives, and comic duo dynamics).

This synthesis gave Star Wars a depth and trans-generational resonance that pure spectacle could never achieve. By 2012, it had become an enduring global phenomenon: the original film was among the first inducted into the Library of Congress National Film Registry for being culturally significant, the Jedi religion was listed by more than 500,000 people across the English-speaking world in government censuses, the saga was the subject of academic curriculum at institutions including USC, Northwestern, and Georgetown, and the phrase "May the Force be with you" had become embedded in everyday lexicon.

Exit Rationale, Deal Structure, and Integration

At 68, planning to remarry and expecting a baby, Lucas sought retirement to focus on family, philanthropy, and experimental films. He publicly declared it was time to pass Star Wars on to a new generation of filmmakers. With no heirs involved in the business, he turned to M&A as a path to succession.

He selected Disney, a global media conglomerate with over $42 billion in annual revenue, under the leadership of CEO Robert Iger. Disney had previously acquired Pixar ($7.4 billion, 2006) and Marvel ($4 billion, 2009). Lucas, conscious of his legacy, viewed Disney’s family-friendly ethos as aligned with the Star Wars themes of heroism and moral clarity. Iger personally courted Lucas over 18 months to build trust.

The transaction valued Lucasfilm at $4 billion (an implied 10x normalized historical EBITDA). Lucas received approximately half in cash and half in Disney shares. As part of the deal, Lucas handpicked his successor (Kathleen Kennedy), was named a Creative Consultant, and provided detailed story treatments for the next trilogy he had been developing. Post-closing, Disney integrated Lucasfilm into its studios division, granting it operational autonomy similar to Pixar.

Financial Wins but Cultural Turmoil

Financially, the acquisition was initially a success. The sequel trilogy and spinoffs grossed approximately $6 billion worldwide. Streaming successes like The Mandalorian drove Disney+ to 10 million signups within just 24 hours of launch, while theme park expansions like Galaxy’s Edge contributed to a 6% revenue increase for the Parks division in its opening quarter. Lucas personally benefited enormously as his Disney shares appreciated, reaching $7 billion in 2021.

However, beneath these aggregate numbers, the trajectory told a different story.

Creatively, the sequel trilogy was criticized for lacking the unified vision Lucas had provided for the previous six films. Box office returns declined with each installment: $2.07 billion for The Force Awakens (2015), $1.33 billion for The Last Jedi (2017), and $1.07 billion for The Rise of Skywalker (2019). Solo: A Star Wars Story (2018) became the first Star Wars film to lose money (estimated $77 million loss). Furthermore, the Galactic Starcruiser immersive hotel opened in 2022 only to close 19 months later.

According to Bob Iger (The Ride of a Lifetime, 2019), friction between Disney and Lucas arose rapidly regarding the creative decisions made. Lucas felt betrayed. He described the sale in a 2015 interview with Charlie Rose as "selling his kids to the white slavers", which revealed the depth of his anguish. In a 2020 conversation with Paul Duncan, he described the process as "very, very painful," like a breakup or "handing your kids over to the wrong people". Lucas realized that while he understood the legal reality of the contract, he had believed the purchase came with a tacit promise of stewardship that was ultimately broken.

Reflections for Business Leaders

What made Lucasfilm successful was its operation under Lucas’s singular creative approach, which enabled the production of its distinctive IP. As a privately held company with Lucas as the sole shareholder, it was insulated from short-term public-market pressures. Every decision flowed through one vision.

However, the moment a unique organization enters the hands of a public company structured for scale and shareholder returns, everything changes. The M&A deal with Disney exposed this classic tension in founder exits.

Clayton Christensen’s Harvard Business Review framework distinguishes "Leverage My Business Model" acquisitions (integrating resources into existing operations for efficiency) from "Reinvent My Business Model" acquisitions (preserving a unique culture or creative engine). Lucasfilm was the latter: its value resided in Lucas’s vision.

Disney was not a predatory acquirer. It was a sophisticated, well-resourced entertainment conglomerate that genuinely admired the franchise. Disney acquired Lucasfilm as a Reinvent asset. However, a structural problem emerged: a publicly traded company operating under the doctrine of economist Milton Friedman’s shareholder value maximization will, inevitably, optimize for financial throughput. Consequently, under shareholder-value pressures, Disney treated it as a Leverage asset, accelerating production and replacing coherence with committee-driven output. One creator's coherent mythological vision was replaced by a production model optimized for quarterly content output. For a founder whose legacy matters, that structural reality is the risk, regardless of how much goodwill exists at the signing table. The nature of the buyer matters.

George Lucas received a massive fortune but watched the meaning of his life's work recede. His experience is the archetype of seller's remorse, which affects an estimated 75% of founders within a year of their exit. The regret was not about the money, but about the realization that the standard M&A playbook treated the company he founded as a financial asset to be optimized rather than a mission to be upheld.

For business leaders who have built something meaningful, Lucas’s story poses the essential question: Was the M&A transaction process designed as an exit or a succession? An exit maximizes the check. A succession preserves your life’s work. Years later, you can observe that what you built still reflects the values that made it matter in the first place, and continues to thrive in the right hands. By that measure, one of the most iconic entertainment M&A deals also became one of its most instructive failures in stewardship.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.

The $85 Billion Bet. Can Union Pacific and Norfolk Southern Defy the Graveyard of US Railroad Mergers?

Norfolk Southern CEO Mark George and Union Pacific CEO Jim Vena

On 29 July 2025, Union Pacific Corporation and Norfolk Southern Corporation announced an agreement to create a coast-to-coast American freight railroad, the first since the transcontinental line was completed in 1869. The $85 billion transaction would be the largest railroad merger in history.

The strategic rationale is genuine: eliminating costly handoffs between eastern and western railroads, cutting transit times, and winning freight back from trucking. The execution risks are severe: every major American railroad merger in the past thirty years has produced operational chaos. The outcome will not be visible for a decade.

This is not simply a story about railroads. It is whether a deal that makes strong sense on paper can survive contact with operational reality

Listen to a discussion inspired by this article on the Glenshore Perspectives podcast.

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The Context

American freight rail is dominated by six "Class I" railroads (the federal designation for the industry's largest carriers), which combined control approximately 90% of US rail freight. Over time, the industry has consolidated into two regional duopolies:

• West of the Mississippi River: Union Pacific (headquartered in Omaha, Nebraska, $24.9 billion in 2024 revenue, 32,000 route miles across 23 states) competes with BNSF Railway, a subsidiary of Warren Buffett's Berkshire Hathaway.

• East of the Mississippi River: Norfolk Southern (headquartered in Atlanta, Georgia, $12.3 billion in 2024 revenue, 19,000 route miles across 22 states) competes with CSX Transportation.

There are also two Canadian carriers (Canadian National and Canadian Pacific Kansas City) operating networks extending into the United States.

This structure creates an operational problem. Freight moving coast-to-coast must transfer between railroads at junction points (Chicago, St. Louis, Kansas City, Memphis) where cargo waits while the receiving railroad processes paperwork, reconciles systems, and accepts responsibility. A container of electronics from a port in New Jersey bound for California may sit in a Chicago rail yard for two or three days, adding cost and unpredictability that makes trucking, despite higher fuel costs, often the rational choice for time-critical freight.

The proposed merger would eliminate this divide. Norfolk Southern shareholders would receive one Union Pacific share plus $88.82 in cash per share, valuing the company at $320 per share (a standard 25% premium). Jim Vena, Union Pacific's CEO since August 2023 and a 40-year railroad veteran who started as a brakeman, would lead the combined entity. Mark George, Norfolk Southern's CEO since September 2024, who was installed after the board terminated his predecessor amid conduct violations and lingering pressure from activist investor Ancora Holdings, would see his railroad absorbed.

The Surface Transportation Board (STB), the independent federal agency with exclusive jurisdiction over railroad mergers, received a 7,000-page application in December 2025. In January 2026, they unanimously rejected it as incomplete. Resubmission is expected in March, with closing targeted for early 2027. Critically, this will be the first major merger evaluated under the STB's 2001 rules, which require applicants to prove the transaction will enhance competition, a standard adopted after catastrophic service failures following earlier consolidations in the industry.

The Case For: A Problem Worth Solving

The strategic rationale for the merger is not manufactured, as the interchange problem is real and shippers have complained about it for decades. Union Pacific and Norfolk Southern estimate that single-line service would eliminate handoff delays for roughly one million shipments annually, cutting 24 to 48 hours from coast-to-coast transit. Oliver Wyman, the consultancy, projects that faster and simpler rail service would convert 105,000 truckloads annually to rail in underserved central US markets.

The companies project $2.75 billion in annual synergies, including $1 billion from operational efficiencies and $1.75 billion from revenue growth as freight shifts from highway to rail. Over 2,000 letters of support were secured, including more than 500 from shippers. SMART-TD, the largest American rail union, endorsed the deal after securing commitments to preserve all union positions. Over 99% of shareholders at both companies approved the transaction in November 2025.

Jim Vena's background lends credibility. Unlike financial engineers parachuted into corner offices, he spent four decades operating trains before running them. If anyone understands what integration requires, the argument goes, it is someone who has worked every job from brakeman to CEO.

The Case Against: The Synergy Mirage

The skeptics do not dispute the strategic rationale but the assumption that this management team, or any management team, can execute an integration of this complexity without destroying what they are attempting to build.

Integration failures are common in Mergers & Acquisitions, but they are uniquely unforgiving in railroads. Trains run around the clock on fixed infrastructure, and a congestion problem in one yard cascades within hours to yards hundreds of miles away. IT systems must communicate in real time, with no grace period for reconciliation. Safety regulations permit no shortcuts. And unlike trucking, you cannot simply reroute around a problem: the tracks go where they go. This is why railroad mergers fail catastrophically rather than merely underperform: the network amplifies errors rather than absorbing them.

The historical record is unambiguous:

• 1996: The Union Pacific and Southern Pacific merger produced a two-year meltdown. Houston, the nerve center of the combined network, became gridlocked. Trains backed up for hundreds of miles. Shippers diverted cargo to trucks. Analysis by industry scholar Robert Gallamore documented how the catastrophe cost Union Pacific billions and damaged the broader American economy.

• 1999: The Conrail split between Norfolk Southern and CSX produced eighteen months of IT failures and operational paralysis.

• 2025: Even the far smaller 2023 Canadian Pacific and Kansas City Southern combination stumbled in May, when an IT system cutover caused service disruptions severe enough to prompt STB intervention.

The projected $2.75 billion in synergies deserves scrutiny. Academic research by economists John Bitzan and Wesley Wilson, published in the Review of Industrial Organization (2007), examined railroad mergers from 1983 to 2003 and found "tremendous differences across mergers with respect to the direction, level, timing, and source of cost impacts." Some mergers delivered substantial savings, and others increased costs. An earlier study by MIT economists Ernst Berndt and Ann Friedlaender (Journal of Productivity Analysis, 1993) found that cost reductions from mergers ranged from 33% for Burlington Northern to a 3% increase in costs for CSX. In M&A, neither cost synergies nor revenue synergies are assured, despite Excel spreadsheet simulations.

Competitor BNSF Railway has mounted aggressive opposition, arguing in an October 2025 position paper that the combined carrier would control 45% of US freight tonnage. Their Chief of Staff, Zak Andersen, posed a direct challenge: "No customer is asking for this. This is strictly a Wall Street play for shareholders." Two major unions, the Brotherhood of Locomotive Engineers and Trainmen and the Brotherhood of Maintenance of Way Employees Division, withdrew their support in December 2025, citing safety concerns.

Reflections for Business Leaders

What separates railroad mergers that deliver value from those that destroy it?

The academic research points to a consistent pattern. Mergers that succeed tend to be "end-to-end" i.e. connecting complementary networks rather than consolidating parallel routes. The Union Pacific and Norfolk Southern combination meets this criterion, as the two railroads meet at interchanges rather than competing head-to-head. But end-to-end structure is necessary, not sufficient. The 1996 Union Pacific-Southern Pacific merger was also end-to-end and still resulted in a catastrophe.

Strategic fit does not guarantee operational success. The question is not whether the networks connect but whether the organizations can be combined without destroying what made them function individually.

The differentiating factor in M&A, across industries, is whether acquirers understand what they are buying well enough to avoid destroying it during integration. It is crucial to distinguish between "Hard Keys" (financial structure, legal terms, strategic rationale) and "Soft Keys" (leadership selection, cultural integration, and operational continuity). This distinction was formalized in KPMG's seminal 1999 study, Unlocking Shareholder Value, which found that transactions favoring these soft keys were 26% more likely to succeed. Yet the standard M&A playbook focuses almost exclusively on Hard Keys, because they are easier to quantify and defend.

In railroads, the Soft Keys include the institutional knowledge of dispatchers who understand how to route trains through congested yards, the relationships between operating crews and maintenance teams that enable problems to be solved before they cascade, and the informal practices that keep 50,000 miles of track functioning around the clock. These capabilities do not appear in due diligence documents. They are precisely what integration destroys when executed poorly, and what the meltdowns of 1996, 1999, and 2025 obliterated.

The objective assessment is that the outcome of this merger is uncertain. The strategic rationale is sound. The execution risk is severe. Jim Vena's operational credibility is real, but individual leadership has never been sufficient to overcome structural integration failures. The 2001 STB rules impose stricter scrutiny, but regulatory oversight has never prevented a meltdown, only provided mechanisms to address one after the damage is done.

The stakes extend beyond shareholders. If the integration succeeds i.e. if Union Pacific and Norfolk Southern can maintain service levels, retain experienced personnel, and satisfy shippers through the transition, they will have achieved something no American railroad merger has achieved in 30 years. If it fails, the pattern will repeat i.e. service collapses, shippers defect, and the consequences fall on workers, customers, and communities along 50,000 miles of track.

The STB will render a regulatory verdict by 2027. The operational verdict will take a decade, long after the current CEOs have moved on and the M&A advisory fees have been collected. The business leaders worth watching are not those who engineer the deal, but those who live with its consequences. In M&A in general, as in railroads, the test of responsible stewardship is not the completion of the transaction itself but the decade that follows.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.

Seller's Remorse: The Hidden Cost of Prioritizing Exit Over Succession in Mergers and Acquisitions

In the world of Mergers & Acquisitions, the completion of a transaction feels like victory: champagne pops, wires transfer, and the seller walks away with a life-changing amount of money.

Yet for many business leaders exiting, especially founders and family owners, the celebration fades fast. According to the Exit Planning Institute's State of Owner Readiness research, 75% of business owners who successfully sell their companies experience profound regret within one year of the exit. Not mild disappointment. Not nostalgia. Profound regret.

This is not about the price they negotiated. It is not about letting go. It is about watching the company they built slowly unravel under new ownership: key people leave, culture erodes, and the mission that once defined the business fades into the background. The transaction that was supposed to secure their future has instead placed their life's work in the wrong hands and liquidated its meaning. This is seller's remorse.

How Auctions Destroy Legacy

Founders spend decades building revenue generated from a distinctive way of operating: how problems are solved, employees are treated, clients are served. That culture is the true engine of competitive advantage.

Yet in a price-driven process typical of the standard M&A playbook, the buyer is chosen for their wallet, not their stewardship. M&A advisors, compensated as a percentage of the final transaction price, orchestrate a sale process as a competitive auction centered on financial value. Price becomes the dominant selection criterion.

Even when sellers articulate concerns about legacy, employee welfare, or strategic continuity at the outset, these priorities are progressively marginalized by the transactional machinery. The due diligence covers financial, legal, commercial and technical documentation but rarely captures the informal networks of trust, the unwritten decision-making norms, or the cultural practices that actually generate the company's performance.

The process exploits a natural ambivalence: the pull between financial maximization and the desire to see the company thrive in capable hands. The allure of a record valuation provides the expectation of an exciting personal future and the social validation, while the auction's urgency and structure make non-financial criteria operationally invisible.

The result is a systematic gap between intention and outcome. Sellers may start with broader aspirations, but by closing they often end up selecting the highest bidder, regardless of cultural or strategic fit. This gap is not accidental, but structural in the standard M&A playbook.

When the buyer is misaligned, when their management style, values, or methods clash with the internal equilibrium, the fallout is swift. PwC's "Creating Value Beyond the Deal" research shows that in deals where significant value was destroyed, 82% of companies lost more than 10% of key employees in the first year. Talent exodus takes institutional knowledge, client relationships, and operational know-how out the door. What remains is a hollowed shell that may carry the same name but no longer delivers the same results. 

The Poisoned Check

For sellers who stay on during transition (often contractually or out of moral obligation), this is excruciating. They become powerless witnesses to decisions that contradict everything they built: cost cuts that slice through muscle, cultural impositions that demotivate teams, strategic shifts that abandon the original mission.

The regret deepens with recognition of complicity: they prioritized the size of the check over the quality of the handover. They allowed the validation of a high price to override instincts about fit and continuity.

What sellers receive in most deals can be described as a "poisoned check": immediate liquidity that comes laced with the delayed certainty of having commodified something alive. 

The Reputational and Legacy Cost 

The pain extends beyond personal anguish. In professional networks and industry communities, how a leader exits matters. Selling "to the highest bidder" without clear discernment can be perceived as sacrificing integrity for expediency. This creates a discontinuity: the image of long-term thinking, loyalty, and purpose that took years to build is suddenly at odds with the observed behavior.

Most profoundly, legacy, the lasting imprint the leader hoped to leave, is erased. Legacy cannot be quantified, benchmarked, or compared in a price matrix, so it vanishes in the shadow of financial competition. The transaction becomes the sale of a financial asset, not the transmission of a mission.

Clayton Christensen's distinction between 'Reinvent My Business Model' and 'Leverage My Business Model' acquisitions captures this precisely. Sellers have built something worthy of reinvention, continuation, and evolution. Buyers, focused on recouping a price too high through immediate synergies, approach it as leverage: a resource to be extracted, rationalized, and absorbed. The very uniqueness that commanded the premium becomes the first casualty of integration.

Defining Success: Exit vs Succession 

Seller's remorse is avoidable. But avoiding it requires rejecting the standard M&A playbook from the start.

When the process treats the company as a pure financial asset, it creates the structural conditions for remorse before the sale and purchase agreement is executed. If legacy, employee welfare, and continuity are genuine priorities, they must be made operational, not aspirational add-ons. This means for the responsible M&A advisor structuring a process that makes intangible value visible and defensible, and for the responsible Seller accepting that the right steward may not offer the highest number.

Above all, it requires reframing the definition of success. In the standard M&A playbook, success is the size of the check at closing. In a succession M&A playbook, success is the health and trajectory of the enterprise five years later.

The choice facing every business leader contemplating a sale is deceptively simple: Are you executing an exit, or are you stewarding a succession? An exit extracts maximum value today, regardless of tomorrow. A succession ensures that what you built continues to thrive, guided by hands you deliberately chose.

One delivers a check. The other produces a legacy.

The difference is the difference between a transaction you'll celebrate long after it is completed, and one you'll spend the rest of your life regretting.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.

Yvon Chouinard’s Patagonia Succession: A Legacy-First Approach to Mergers and Acquisitions

Yvon Chouinard, Founder and Former CEO of Patagonia

In the annals of recent business history, few decisions capture the essence of principled leadership as vividly as Yvon Chouinard’s exit from Patagonia in 2022.

In his early 80s, Chouinard faced a universal dilemma for founders: what to do with the company he had built over five decades around high-quality products and environmental activism. Patagonia, the Ventura, California-based outdoor apparel giant valued at around $3 billion, was more than just a business. It had long prioritized environmental stewardship over obsessed growth.

Rather than pursuing maximum financial proceeds through a competitive Mergers & Acquisitions auction or IPO, Chouinard structured the succession to protect Patagonia’s core mission of environmental responsibility while ensuring ongoing profitability. This decision stands as one of the clearest real-world examples of how a founder can design succession to sustain a company while sidestepping the value-destruction dynamics common in the standard M&A playbook.

Listen to a discussion inspired by this article on the Glenshore Perspectives podcast.

Subscribe on Apple | Spotify

The Founder’s Succession Dilemma in Purpose-Driven Businesses

In the 1950s, Yvon Chouinard, a rock-climbing enthusiast, started as a blacksmith forging climbing gear in his garage in Ventura, California. He founded Patagonia in 1973 with a simple ethos: create high-quality products that cause the least harm to the planet. Chouinard named the company after the rugged Patagonian region in South America that inspired his early adventures, though the business has always been headquartered in the United States.

Over the years, the company became synonymous with environmental activism, suing the U.S. government over public lands, donating 1% of sales to grassroots nonprofits since 1985, and pioneering sustainable materials like organic cotton and recycled polyester. By the early 2020s, Patagonia was generating over $1 billion in annual revenue, with profits around $100 million yearly.

As Chouinard considered succession, family ownership was not viable: his adult children had no interest in running or inheriting the company. Selling to a strategic buyer, a private equity firm, or taking it public carried clear risks. In his words from the 2022 announcement: “One option was to sell Patagonia and donate all the money. But we couldn’t be sure a new owner would maintain our values or keep our team of people around the world employed.” An IPO, he noted, would subject the company to shareholders “who might push us to create short-term gain at the expense of long-term vitality and responsibility.”

These concerns align directly with documented M&A patterns. Research from PwC, KPMG, and Harvard Business Review shows 70–90% of transactions fail to create expected value, often because aggressive post-closing integration, driven by the need to recoup high purchase prices, erodes the cultural and relational elements within the organisation that sustain performance. Chouinard’s choice avoided placing Patagonia in that standard M&A playbook trap.

Avoiding the Traps of Price-Centric Mergers & Acquisitions

In a conventional process, M&A advisors would prepare an attractive equity story emphasizing strategic rationale and financial metrics to attract the broadest pool of buyers, then run a time-compressed auction process where price dominates bid evaluation. This creates a tunnel effect: intangibles like culture, employee loyalty, and mission alignment become secondary or invisible, as price becomes the dominant criterion. The winning bidder, having paid a premium (often 10–35%), faces immediate pressure to deliver synergies through cost reductions or restructuring, frequently cutting the “muscle” (unique capabilities and relational networks) along with any perceived “fat.” That leads to shareholder value destruction. This is the winner’s curse.

Chouinard rejected this path.

He and his family transferred voting stock (2% of total shares) to the Patagonia Purpose Trust, governed by family members and trusted advisors to safeguard the company’s values and B Corporation status. The remaining 98% of non-voting stock went to the Holdfast Collective, a nonprofit dedicated to fighting the environmental crisis through policy advocacy, conservation, and community support. Annual profits not reinvested in the business flow as dividends to the Collective, approximately $100 million per year based on recent performance, rather than to private shareholders. The family paid roughly $17.5 million in gift taxes on the voting shares, and no tax-avoidance motive was claimed.

Today, Patagonia continues to operate as an independent for-profit company, free from external pressure to maximize short-term returns.

By forgoing an auction entirely, he prevented the winner’s curse dynamic and the subsequent “poisoned check” that many sellers experience: immediate life-changing liquidity paired with long-term regret over the company’s erosion due the wrong buyer. His structure makes the company’s DNA the central element of continuity rather than erasing it for marketability.

Through the Lens of Responsible Capitalism

Chouinard’s exit embodies a principled alternative to current business practices, drawing from Adam Smith’s “impartial spectator” from The Theory of Moral Sentiments (1759), the moral conscience guiding action, rather than the profit-maximization doctrine that has dominated corporate thinking since Milton Friedman’s article “The Social Responsibility of Business Is to Increase Its Profits” (1970) in the New York Times. Chouinard realigned profit as a means to sustain human and societal ends, rather than an end in itself. It addresses the three anthropological imperatives that we all have as human beings: agency (ongoing capacity to act on the environment), reciprocity (mutual obligations to employees, customers, and ecosystems), and lineage (perpetual transmission of value to future generations).

Chouinard’s responsible business leadership and Patagonia’s culture of activism and innovation became the cornerstone of the succession. The company remains profitable, reinvesting in growth while directing surpluses to higher ends. Chouinard’s story proves that stewardship can coexist with financial health, consistent with studies showing higher success rates when these factors are addressed upfront in M&A transaction processes. It also challenges business leaders to question the concept of success in M&A dealmaking, and in business in general.

Reflections for Business Leaders

Yvon Chouinard’s story is timeless because it addresses eternal leadership dilemmas: How do you preserve what you’ve built? When do you let go, and to whom? In an era of elevated M&A activity (e.g., $3.4 trillion in 2024 per McKinsey, with continued momentum in 2025), his example urges executives to design successions that champion responsibility and honour the human adventure of business.

These are not calls to idealism but recognition of trade-offs that the standard M&A playbook often obscure. In an environment where 70% of transactions still destroy value after closing, Patagonia offers a documented alternative: succession designed for the long term.

Chouinard’s decision does not pretend to be easy or universally replicable. But it shows that a founder can exit without liquidating the meaning of what was built and their legacy, one structural choice at a time.

Corporations are vessels for human purpose. As Chouinard put it, “We’re in business to save our home planet.” His succession ensures Patagonia’s adventure continues, not as a hollowed-out asset, but as a living force for good. For leaders facing their own transitions, this is more than inspiration, it's a call to restore the compass to true north, decision by decision. In a world of hollow successes, Chouinard’s choice stands as a beacon of what principled capitalism can achieve.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.

The $32 Billion Bet. Alphabet's Acquisition of Wiz and the High Cost of the Winner's Curse in M&A

Wiz CEO Assaf Rappaport and Alphabet CEO Sundar Pichai.

The ink is barely dry on Alphabet's $32 billion acquisition of cloud security unicorn Wiz in March 2025, yet the transaction has already become a Rorschach test for the market.

To the optimists, it is a masterstroke, a decisive move by Google to secure its footing in the AI-driven cloud wars, finally answering the dominance of AWS and Azure. To the skeptics, it is a desperate overpayment, a textbook example of the "Winner's Curse" where the prize of winning the auction comes at the cost of potentially destroying the asset, and the shareholder value.

Listen to a discussion inspired by this article on the Glenshore Perspectives podcast.

Subscribe on Apple | Spotify

The Context

Wiz is more than just a successful startup. It is a phenomenon. Founded in 2020 by Assaf Rappaport and his team of former Microsoft executives (the same unit that built Adallom, acquired by Microsoft for $320 million), Wiz grew to $350 million in annual recurring revenue (ARR) by February 2024, $500 million by March 2025, with analysts forecasting $640–800 million in revenue for the coming year.

Their secret sauce was not just their AI-native scanning technology, but their architectural neutrality. By sitting agnostically between AWS, Azure, and Google Cloud, Wiz became the "Switzerland" of cloud security, trusted by 40% of the Fortune 100 precisely because it favoured no single sovereign.

Talks started in May 2024 but collapsed in July 2024, when Wiz famously rejected Google’s $23 billion offer to pursue an IPO. At the time, the regulatory "chilling effect" of the Biden administration’s FTC and antitrust concerns made the deal untenable. However, the window reopened in early 2025. With the Trump administration signalling a return to a more permissive M&A environment, the brakes came off. What followed was a frenzy. The renewed auction drew interest not just from strategic giants (e.g. Microsoft), but from private equity powerhouses (e.g. Thoma Bravo and Blackstone), creating a high-pressure competitive tunnel.

Alphabet emerged as the victor, but the cost of victory was steep. By returning to the table, Google paid $32 billion, a $9 billion premium over the price Wiz rejected just eight months prior. This represents a staggering 40-50x forward revenue multiple (64x trailing), a figure that defies traditional financial gravity and implies the price was driven not by fundamentals, but by the sheer scarcity of the asset and Google's desperation to deploy capital in the AI era.

Strategic Rationale vs. Day-to-Day Reality

Strategically, the logic is seductive, and one can argue that this is the only logical move for Alphabet. Google Cloud Platform (GCP) has long trailed AWS and Azure in security perception. While Google owns Mandiant (world-class incident response, acquired for $5.4 billion), it lacked a dominant prevention engine. Wiz’s "Agentless Scanning" technology allows it to instantly map a customer’s entire cloud estate (including AWS and Azure workloads) without installing friction-heavy software.

With Wiz, Google instantly buys credibility and fills a critical void. This move enables Google to pivot to become the dashboard for every enterprise’s multi-cloud and AI security strategy, a stack that Thomas Kurian (Google Cloud’s CEO) desperately needs to close the market share gap. Google is also acquiring a team of elite Israeli cybersecurity architects who operate with a speed Google’s own bureaucracy has long lost, according to contacts in the industry.

However, we can also point to the graveyard of similar deals. Wiz’s commercial strength has been its vendor neutrality. That neutrality evaporates the moment it becomes a Google subsidiary. Will AWS and Azure customers continue to trust a security layer owned by their fiercest competitor? This "Switzerland Paradox" is a critical risk. If customers view Wiz as a Trojan Horse for Google Cloud, the revenue stream is in danger.

Furthermore, there is the question of "Organizational Rejection." Can a flat, hyper-agile startup survive inside the layered hierarchy of Mountain View? The comparison to Mandiant (acquired by Google for $5.4 billion in 2022) is haunting, despite initial retention incentives, the slow erosion of talent and speed became inevitable once the lock-up periods expired and the mission was subsumed by the machine. Alphabet CEO Sundar Pichai's explicit promise to maintain Wiz's independence (backed by a reported $3.2 billion break-up fee structure) suggests Google is aware of the risk, aiming to preserve the agility that made Wiz valuable. But awareness does not guarantee execution.

The Danger of the High Multiple

While the market debates strategy, I believe the real danger lies in the structure of the transaction itself.

Wiz was acquired on a 40-50x forward revenue multiple. When a buyer pays such an extreme multiple, they remove their own margin for error. To justify a $32 billion price tag to shareholders, Alphabet cannot simply let Wiz "be," despite legal agreements. The financial gravity of the deal will inevitably force them to seek massive, immediate synergies.

The standard M&A Playbook led investment bankers to organise a bidding war that inflated the price. Now, to justify that price, Google will be pressured to integrate Wiz aggressively. Cross-selling to Google customers and merging back-ends will be the easy part. The real challenge is preserving Wiz's flat, rapid-iteration culture inside Alphabet's hierarchy. The auction's victory could become a slow erosion of the very capabilities that justified the premium. This is where the "M&A Paradox" strikes. Google won the dream company, but the integration will likely be a nightmare, for all parties.

Reflections for Business Leaders

This deal underscores live tensions in the 2025-2026 M&A landscape: High multiples reward optimism but amplify integration challenges.

Independence promises and retention incentives show awareness of the issue, but disagreements on neutrality and scale highlight potential oversights in standard M&A processes. The 40-50x multiple, for instance, is so irrational that it signals a process overly focused on price rather than fit.

For buyers, winning the auction is not winning the game. If your M&A process does not measure the "Muscle" (culture) as accurately as the "Fat" (costs), you will inevitably cut the wrong things.

For sellers, an irrational valuation is often a "Poisoned Check." It looks like victory, but it frequently leads to the dismantling of your legacy as the buyer scrambles to recoup their overpayment. Prioritize bidders who demonstrate cultural understanding. But even here, awareness is not enough. A record multiple like this is totally irrational if the process ignores intangibles.

For all business leaders watching this unfold: The lesson is not about cloud security, but about Stewardship.

The Wiz deal is a reminder that the highest bidder is not always the best steward. A process designed solely to maximize the exit price maximizes the risk of post-closing destruction. True responsible M&A requires resisting the tunnel vision of the auction. It demands a process that values the intangibles of the company as highly as its revenue stream. Because in the end, if you buy the asset but kill the organization, you have bought, and sold, nothing of value.

Time will tell if Alphabet can defy the odds, but the structural forces of the standard M&A playbook are already working against them.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation.

Mergers and Acquisitions: Why Selling to the Highest Bidder Can Jeopardise Your Company’s Future.

In M&A, a common trap undermines long-term success: an over-reliance on price as the deciding factor. What begins as a reasonable focus on maximising proceeds for shareholders and founders often leads to sidelining the intangible elements, especially organisational culture, that drive sustained performance and value creation.

Even experienced founders and executives can find themselves prioritising a simplified financial outcome over the operational realities that built their company. The highest bidder may win the auction, but the business frequently pays a heavy price afterwards, with integration failures eroding synergies and diminishing the company’s prospects.

The highest bidder wins the day, but the company often loses its future.

The Dynamics of Price-Driven Decisions

The standard M&A playbook tends to follow a familiar sequence:

1. The Equity Story: A narrative emphasising financial performance, tailored to attract a broad range of buyers.

2. The Competitive Auction: A competitive process with artificially compressed timelines.

3. Bid Evaluation: A hierarchical evaluation of bids dominated by price.

This approach seems efficient and objective, since price is tangible and easy to compare. Sellers, particularly in founder-led businesses, are drawn to the promise of greater liquidity and personal financial security. Yet it introduces a powerful bias. The allure of “more money” can overshadow initial concerns about legacy, employee welfare, and long-term continuity. Qualitative factors like strategic alignment, cultural compatibility, and community ties are often acknowledged in discussions but rarely prove decisive.

M&A advisors, compensated through fees linked to deal size, understandably guide processes toward higher valuations. Data rooms brim with financial, legal, and operational materials, but rarely delve into the informal norms, trust networks, or decision-making patterns that shape everyday execution.

As the process unfolds, sellers adapt to this financial emphasis. What starts with broader aspirations gradually narrows, leading to a transaction that maximises short-term gain but risks the company’s enduring health.

The Overlooked Core: Culture as the True Value Driver

Every successful company has a unique culture, a distinctive mix of shared purpose, proven practices, relational dynamics, and decision heuristics that turns strategy into results. These intangibles are the real engines of competitive advantage and cash flow generation, yet conventional processes often obscure them.

The equity story, designed for wide appeal, simplifies complexities to reduce friction and maintain momentum.

The irony is profound: in order to maximise financial perception, the process actively erases the very elements responsible for long-term value creation.

Buyers relying on this polished financial view acquire an organisation they only partially understand. Post-closing, integration frequently involves applying standardised efficiencies to a bespoke system. Efforts to justify the premium through cost cuts can unwittingly eliminate essential capabilities, mistaking vital strengths for redundancies.

My experience in the field confirms this, and the data bears it out. Research from Harvard Business Review consistently places the M&A value destruction rate between 70–90%. The primary culprit is rarely the strategy; it is the failure to measure and protect culture.

Escaping the Price Trap

This over-reliance on price is not inevitable; it arises from how most M&A processes are designed, and sellers can choose a different path.

Responsible approaches exist that widen the competitive field, not on who pays the most for future cash flows, but on who best demonstrates a deep understanding of the drivers of the company’s long-term performance. Incorporating cultural due diligence through anonymous employee surveys, leadership interviews, and behavioural assessments, renders intangibles visible, comparable, and easier to protect.

This requires rejecting the false appeal of price as the sole arbiter. Instead, design a process that deliberately highlights and safeguards intangible value, empowering your team and unlocking genuine synergies.

When stewardship is elevated alongside price, the outcome shifts decisively: the transaction becomes a true succession rather than a liquidation, one that empowers your people, positions the company to thrive long after your exit, and safeguards your legacy.

—

Amine Laouedj Managing Director, Glenshore

I advise responsible business leaders who wish to ensure their company ends up in the right hands and continues to flourish after their exit. If these perspectives resonate with your thoughts, I welcome a conversation. Please connect or message me on LinkedIn.

Glenshore is a boutique investment bank with the Succession M&A Playbook, a disciplined approach to align financial outcomes with long-term mission and legacy preservation. Learn more at glenshore.com.