Mergers and acquisitions have maintained a steady pace this year, and some big name companies have been looking to make strategic acquisitions in order to expand their market base. Of course, when two big companies seek to become one, there is a higher likelihood that the U.S. Department of Justice will challenge the validity and legality of the deal, as has happened with AT&T’s efforts to purchase Time Warner. Despite the financial and strategic benefits of joining forces with another large entity, the threat of eliminating competition and price increases often makes investors, analysts, and particularly consumers a bit nervous. Nonetheless, these are some of the impressive deals that have closed this year.
Amazon and Whole Foods
Amazon was already a leader in online shopping, content streaming, and the ebook industry, and now it is taking its dominance even further. Amazon spent almost fourteen billion dollars to purchase Whole Foods, which seems like a pretty hefty sum considering its primary focus is online shopping versus the traditional in store shopping that occurs at Whole Foods. Of course, Amazon will no doubt be expanding its food delivery options, and has already begun to cut prices in the fairly overpriced Whole Foods stores. Amazon’s goal to make fresh, healthy food affordable for everyone will no doubt prove successful.
Intel and Mobileye
Mobileye is a computer vision and machine learning company that has been working on making autonomous automobiles an everyday reality. With Intel’s computing capability and Mobileye’s self-driving technology, Intel is hopeful that it can make self-driving vehicles. This is something that other companies are also seeking to achieve, the ultimate goal of which will be to make driving safer, more energy efficient, and environmentally friendly.
Johnson & Johnson and Actelion
Johnson and Johnson, the medical, pharmaceutical, consumer goods giant with interests in all things health care, purchased Actelion, a Swiss drug making company for thirty billion dollars. The pharmaceutical industry continues to attract the attention and money of investors, so it is not surprising that Johnson and Johnson would be interested in the company that is the leading drug maker for pulmonary hypertension.
Gilead and Kite Pharma
This biotech deal, valued at about twelve million dollars, combines Gilead, a research-based biopharmaceutical company, with Kite Pharma a clinical-based biopharmaceutical company. Kite Pharma is leading the way in innovative cancer drugs that focus on immunotherapy. Even though Kite Pharma was relatively small, its FDA-approved chimeric antigen receptor T cell (CAR T) therapy is expected to completely transform the way cancer is treated. Thus, this deal will likely prove quite lucrative for Gilead.