Fortune fails to favour the brave

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Fortune fails to favour the brave

Investors reacted unenthusiastically to Pfizer's plan to merge with rival US drug company Pharmacia, sending the shares 11% lower. It's not that the deal doesn't make sense but in today's volatile markets any bold move is frowned upon.

It's a measure of just how thin market activity has been this year that our league tables of M&A advisers for the first six months of 2002 have been knocked sideways by one big deal. When major deals are so few and far between, one transaction can make a huge difference to where the various institutions rank.


Pfizer's bid for Pharmacia, announced on July 15, represents $59.4 billion-worth of league table boost for Bear Stearns and Lazard Frères which are advising Pfizer, and for Goldman Sachs in the Pharmacia camp - assuming that nothing gets in the way of completion. No doubt those banks will be delighted to take the credit for arranging what is by far the biggest deal of 2002 so far.


Welcome back to mega-merger territory. For at almost six times the size of the second largest transaction this year, that is where the Pfizer Pharmacia marriage lies. Closest behind is China Mobile's spending spree in May when it splashed out $10.2 billion to buy eight regional mobile telecom companies. The previous month, UK power company National Grid launched a $9.3 billion bid for infrastructure technology group Lattice.



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