’Tis the Season for Serious Dealmaking —Michelson

Likewise, legal disputes resulting from an M&A transaction can draw the disfavor of Wall Street. Valassis Communications saw its stock price plummet after trying to back out of its July announced acquisition of ADVO, accusing ADVO execs of fraud and financial misrepresentation. Culminating in a trial in Delaware Chancery Court last month, the two sides ultimately agreed to complete the merger, with Valassis reportedly now paying $1.2 billion or $33 per share, an 11 percent discount over the previously agreed upon price of $1.3 billion or $37 per share.

Making the deal is the easy part of any acquisition. Senior execs at RR Donnelley, Cenveo and Valassis will now have to roll up their sleeves and carefully navigate the critical integration stage. They’re faced with customer bases looking for assurances that it will be business as usual. Employees—especially those within the acquired companies—won’t know if they have a position within the new corporate structure. And current suppliers may be replaced outright or be facing calls for contract renegotiations. The shockwaves from these major deals will have a ripple effect throughout the entire industry. Hopefully, they won’t cause a tsunami.

Mark T. Michelson