Agree with you Jerome from an operational standpoint. The Glaxo-Wellcome merger did indeed go by the book.
However, when it comes to shareholder's value, particularly in the IT industry where time does not allow for year long integration (see John Chambers' famous "dog years" quote), I remain a firm supporter of small sized acquisitions a la Cisco over mergers a la HP.
A clear indicator of Glaxo-Wellcome's success was their subsequent merger project with SmithKline Beecham, completed a year ago. Success definitely breeds success.
Further, I would stress that mergers in the Pharmaceutical industry tend to be pro-active (a clear advantage over the reactive HP/CPQ merger), i.e. driven by R&D cost reduction. Big drug companies see merging as a way to cut their research and development costs. According to Pharmaceutical Research & Manufacturers of America, a drug industry trade group, the cost of developing a single drug has bolted from $54 million in 1976 -- or an inflation-adjusted $125 million -- to a range of $400 million to $600 million today. Drug makers in the United States and Europe will spend an estimated $20.6 billion on research this year, or about 20 percent of sales. The more money the combined drug maker could sink into its research and development machine, the idea goes, the more likely the company can come up with a big-money drug.
Having said that, even a drastic cost reduction does not make a merger between 2 big drug companies a success. As you raised in your post, mergers require careful planning (identify leaders,"black belts" train the trainers) and a balanced (both companies to be equally involved) mediation process to gather staff support. In comparison, it's worth noting that Pharmacia & Upjohn Inc. is still struggling after its $7 billion 1995 merger.
In conclusion, I support your view from a merger process standpoint. There are indeed successful CEOs who excel at refining this risky undertaking. Nevertheless, even successful mergers dilute shareholders value (short-medium term) which is why I remain opposed to mergers from a shareholder perspective.
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