Hello Doc and class,

• Using the Internet, research acquisitions that are currently underway and choose one of these acquisitions to discuss. Based on the firms’ characteristics and experiences and the reasons cited to support the acquisition, do you feel it will result in increased strategic competitiveness for the acquiring firm? Why or why not?

Blackstone is currently pursuing acquisition of Ancestry.com for a purchase price of $4.7 billion. Blackstone is one of the largest investment firms in the world and has a life science division which makes this a vertical acquisition. From the Blackstone site, “We partner with pharmaceutical, biotech and medical technology companies to address unmet medical needs and improve the quality of life of patients around the world” (blackstone.com). This makes the purchase of Ancestry.com lucrative.

Data collection is hugely valuable. Major companies such as Google, Facebook, and Amazon value the data it collects from users probably more than the sale of any product. The collection of data is valued by companies because it tells them what they need to know about the consumer to continue to market to them. The purchase of Ancestry.com gives Blackstone a database that continues to grow that can be sold to many different groups or controlled allowing them to achieve greater market power. “Ancestry has more than three million paying subscribers across its core Ancestry websites with an extensive collection of over 20 billion records and has more than 15 million people in the Ancestry DNA network.” (ancestory.com). This large valuable database means Blackstone increases its competitive advantage because Ancesory.com has the largest database making it the most valuable. This growth will hopefully allow Blackstone to be the worlds leading investment firms rather than one of the worlds leading investment firms.

• Of the problems that affect the success of an acquisition, which one do you believe is the most critical in the global economy? Why? What should firms do to make certain that they do not experience such a problem when they use an acquisition strategy?

Inadequate evaluation of target is the most critical because if done incorrectly, the others will not fall in place. This will determine if the acquisition is a good fit. If due diligence is done the debt the company carries will be known. Also, you will know the culture of the company and if it is a good fit.

https://www.reuters.com/article/us-ancestry-m-a-blackstone-group/blackstone-to-acquire-ancestry-com-for-4-7-billion-idUSKCN2512ES

https://www.blackstone.com/our-businesses/life-sciences/

https://www.ancestry.com/corporate/newsroom/press-releases/ancestry%C2%AE-surpasses-15-million-members-its-dna-network-powering-unparalleled#:~:text=Ancestry%20has%20more%20than%20three,people%20in%20the%20AncestryDNA%20network.