Mega-Mergers Deals, The Search for Scale

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July 17 (Bloomberg) -- Ernst & Young Americas Managing Partner Stephen Howe and XLR-8 Founder Robert Nardelli discuss mega-mergers and companies looking for more growth. They speak with Tom Keene, Adam Johnson and Scarlet Fu on "Bloomberg Surveillance.” (Source: Bloomberg)

Partner at his firm for over 30 years.

I don't even know where to begin.

How busy is your practice right now?

Is it a strategic frenzy going on?

Cuts it is a busy time, really.

And across all of our -- it is a busy time, really.

And across all of our service lines.

The world is moving fast and we are busy helping.

We have talked about this before.

Is the new five-year strategic plan really three years?

It is.

From my early days on -- at general electric, we stood up focusing on a three years horizon.

I started in 1971, way back in the prehistoric days.

We used to sit around and say, well, we are pretty well protected.

Who was going to ship air in these bigger boxes, right?

Fast forward and we're harkening back to the three circles.

You're either in the circle or out of the circle.

Right now, it appears that appliances are out of the circle.

It is surveillance's then diagram.

Everyone is looking for scale and synergy.

They are looking for tax aversion, but -- tax in version, but what is the main distinction?

Companies are looking for growth, topline and bottom-line.

They cannot get it all organically.

We are going to see multiple deals.

Not just media.

Not just media.

In the last six months it is across sectors.

Businesses are transforming themselves.

Scale is important.

You talk about visor trying to transform itself into a different company and it didn't work.

How much manipulation are you seeing from companies were they say, let's go way out-of-the-box?

First, the starting point is never the inversion.

It is a large-scale, but -- it is the business issue.

But taxes have been another way that these companies can get value.

The u.s. tax system prevents them from doing that.

You see a $100 billion synergy -- that is aware that you and i both hate, synergy.

They would get rid of all of the overlap, the hr department, all of that.

It is small in comparison to the overall size of the deal and the value created.

No question about it.

It is a piece.

Companies have done a great job extracting efficiency since the downturn, but they are pretty much -- have pretty much bottomed that out.

Now we will see scales,

This text has been automatically generated. It may not be 100% accurate.


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