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The Merger of Union Bank of Switzerland and Swiss Bank Corporation (C): Post-Merger Experience
Bruner, Robert F.; Chan, Jessica Case F-1423 / Published November 11, 2003 / 15 pages.
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This case summarizes the implementation of the plan for integrating the two merging firms, Union Bank of Switzerland and Swiss Bank Corporation. Also, the case surveys the financial performance and share price performance of the firm over the five years following merger. The record was generally positive and invites students to reflect upon the drivers of M&A success. The specific tasks for the students include: 1. Identify key issues that arose in the post-merger integration process and the style with which the integration plans were implemented. The new firm encountered a number of serious hurdles (such as the turmoil following the collapse of Long Term Capital Management, in which ex-UBS held an investment position) that might have derailed the integration. How the executives responded to these hurdles illustrates the kind of crisis management that post-merger integration may entail. 2. Evaluate the degree of success of the integration. This task invites students to define "success" in M&A. The case contains information that can permit students to derive conclusions in financial, strategic, and organizational terms. The (A) case in the series describes the proposed terms of merger and invites students to value the benefits of the deal and assess the strategic motives. The (B) case summarizes the integration planning process and issues that had to be resolved before the merger could be implemented. It is recommended that the instructor distributes the (A) case for advance preparation by students and holds the (B) and (C) cases for discussion after the (A) case. The cases about the UBS-SBC merger were prepared to serve a number of learning objectives: A. Exercise skills of valuation and strategic analysis. The cases assume that students have been exposed to standard concepts in these areas and are ready to apply them. B. Survey the often arduous process by which M&A deals are developed and then implemented. These cases give detailed insight into the risks and difficulties of transaction management. C. Explore the terms of merger and the wide range of choice in transaction design. A key lesson here is that "a deal" consists of much more than price. Students will see that issues regarding form of payment, governance, and social terms are vital aspects of a deal. D. Consider the enormous challenges of post-merger integration. The case reports the integration strategies adopted in various lines of business and thereby affords the opportunity for comparing the motives and effects of different integration strategies.


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  • Overview

    This case summarizes the implementation of the plan for integrating the two merging firms, Union Bank of Switzerland and Swiss Bank Corporation. Also, the case surveys the financial performance and share price performance of the firm over the five years following merger. The record was generally positive and invites students to reflect upon the drivers of M&A success. The specific tasks for the students include: 1. Identify key issues that arose in the post-merger integration process and the style with which the integration plans were implemented. The new firm encountered a number of serious hurdles (such as the turmoil following the collapse of Long Term Capital Management, in which ex-UBS held an investment position) that might have derailed the integration. How the executives responded to these hurdles illustrates the kind of crisis management that post-merger integration may entail. 2. Evaluate the degree of success of the integration. This task invites students to define "success" in M&A. The case contains information that can permit students to derive conclusions in financial, strategic, and organizational terms. The (A) case in the series describes the proposed terms of merger and invites students to value the benefits of the deal and assess the strategic motives. The (B) case summarizes the integration planning process and issues that had to be resolved before the merger could be implemented. It is recommended that the instructor distributes the (A) case for advance preparation by students and holds the (B) and (C) cases for discussion after the (A) case. The cases about the UBS-SBC merger were prepared to serve a number of learning objectives: A. Exercise skills of valuation and strategic analysis. The cases assume that students have been exposed to standard concepts in these areas and are ready to apply them. B. Survey the often arduous process by which M&A deals are developed and then implemented. These cases give detailed insight into the risks and difficulties of transaction management. C. Explore the terms of merger and the wide range of choice in transaction design. A key lesson here is that "a deal" consists of much more than price. Students will see that issues regarding form of payment, governance, and social terms are vital aspects of a deal. D. Consider the enormous challenges of post-merger integration. The case reports the integration strategies adopted in various lines of business and thereby affords the opportunity for comparing the motives and effects of different integration strategies.

  • Learning Objectives