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Discovering Diamonds Amid Coal: A Strategic Approach to Creating Value Through Acquisitions
Author(s) -
Pangarkar Nitin
Publication year - 2016
Publication title -
global business and organizational excellence
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.227
H-Index - 16
eISSN - 1932-2062
pISSN - 1932-2054
DOI - 10.1002/joe.21755
Subject(s) - exploit , popularity , value (mathematics) , coal , business , work (physics) , miller , industrial organization , marketing , computer science , engineering , political science , law , waste management , computer security , mechanical engineering , ecology , machine learning , biology
Acquisitions are important strategic initiatives that can create and destroy value in equal measure. Despite the popularity of such endeavors, many companies struggle to realize the benefits they expect. Some companies have succeeded in creating value by “discovering diamonds amid coal”—that is, by buying underappreciated companies and implementing policies that exploit their potential. The experiences of Nestlé‐Alcon, Philip Morris‐Miller Beer, and Mittal Steel highlight the subtleties of this strategy, as well the facilitating conditions needed for it to work.