Half the New Names in Top 500 Global Companies Exploit M&A

Research suggests that M&A (merger and acquisition) is an effective way for companies to boost their global competitiveness. According to a report released by the LG Economic Research Institute on Oct. 28, among the 203 firms that have been newly added to the top 500 global companies list – during the last 10 years from 1997 to 2006 – 101 of them (49 percent) have raised their stature in the global business arena via M&A activity of larger than $500 million. Among the 397 companies that have maintained themselves in the list for the past 10 years, 58 percent exploited M&A. On the other hand, among those companies that were not ranked in the 500 list, only 27 percent have done M&A. The report also showed that the increase rate of sales was better for M&A-savvy companies. Among the 397 companies that have posted their names in the 500 list for 10 consecutive years, the average annual sales increase of those with M&A experience was 8.7 percent while those without only recorded 5.6 percent. Among the newly added companies, the average annual sales increase of those with M&A experience recorded 15.9 percent while those without only recorded 13.6 percent. [Min-jeong Lee / KHS] [ⓒ Maeil Business Newspaper & mk.co.kr, All rights reserved] 10-28, 2007 20:05:00