Good morning, John
Yes, the point about synergies is well taken. In chemistry and biochemistry the term synergy is used to mean that effects are more than additive. If reagent A causes a reaction at a certain rate, and you add synergist s, which does not cause the reaction to occur, the addition of synergist s to reagent A makes proceed much faster. Generally applied to business, it has taken on "the total exceeds the sum of the parts" kind of argument. Not strictly synergy, but close enough. It generally takes the form of cross selling through existing channels without increasing sales expenditures which is translated into a higher top-line figure without increases in selling costs. But now we are seeing a redefinition. If you eliminate redundant functions these folks are now claiming "synergy".
I think its time to jettison all of these buzz-words and focus on financial realities underlying the claims. How does a combination of McKesson and HBOC increase HBOC's sales. How does it increase McKesson's sales?
My suspicion is this. I think that while McKesson is nominally the buyer, I think the reality is that HBOC is the buyer. The fact that McCall becomes chairman of the board ought to tell us something. I believe that he will continue to run the HBOC division (which is larger than the McKesson division), and I think it is naive to believe that MCK management will be calling the shots.
TTFN,
CTC
PS I am seriously considering getting out, because it ought to have been clear to McCall that s/h were less than thrilled at the previous attempt to merge with MCK. I think this speaks to a disregard to s/h interests and a certain arrogance. |
