Patterson october 7, 20 strategic management 5301 walt disney pixar analysis the walt disney pixar merger carries a number of convincing advantages for disney, but pixar shareholders should be less enthusiastic about such a deal. This case study analyses and differentiates the merger and acquisition strategy for the companies of disney and pixar, in the first section, you will find the brief analysis of the. It describes how the new ceo robert iger, who succeeded michael eisner, went on to reestablish ties with pixar and steve jobs, who held 50. Firstly, there will be powerhouse establishment when disney and pixar combined.
Its the owner of 11 theme parks and several television networks, includingthe american broadcasting company abc. Before the disney board got a chance to approve the merger, however. For disney it was a adding muscle to its existing animation strength with a stronger partner. Pixars releases have mostly been highly successful and grossed enormous sums at the box office. Download as doc, pdf, txt or read online from scribd. Case analysis, the walt disney company and pixar inc to acquire or not to acquire. Because animation is integral to disneys corporate strategy, whose characters from animated films drive retail in its theme parks. Special attention is given to five parts, including a historical overview, organizational structure, business operations. Walt disney studio reasons for merging to acquire technology, to complement or replace the currently used one the decrease in competition is another motive for disney disney can also increase its revenue by merging with pixar. However, analysts said that the real value to disney was the talent the deal would bring inhouse, especially pixar executive vicepresident john lasseter, the man credited as being the creative driving force at the firm.
In this paper, i look at the business strategy of amazon. Jul 09, 2015 an animated merger avoiding change management failure. To acquire or not to acquire walt disney along with pixar impacted the entertainment industry in a revolutionary manner when they escalated the use of three dimensional computer generated 3d cg technology. Prior to the merger in 1997, after the release of toy story, a 10year, 5picture deal was signed, evenly splitting production costs and profits on subsequent movies. According to the terms of the deal, disney research will issue 2. The walt disney company was founded on october 16, 1923 when mr.
Questions what are the strong capabilities pixar has. The walt disney company and pixar, inc to acquire or not to acquire. The first case study evaluates the merger between exxon and mobil in 1999 xom, the second evaluates the merger between america online aol and time warner twx, the third evaluates the transaction of disney dis acquiring pixar, and the fourth evaluates the merger between sirius siri and xm radio. Disney case pixar mergers and acquisitions free 30. Acquiring pixar makes the most sense for disneys growth. The predictions of the industrywide efficiency hypothesis concerning the change in value of rival firms after merger related events are identical to those of the monopoly power. The merger in may 2006 ensured that disney still received pixars technology. The case primarily examines the partnership agreement between disney and pixar and puts forth the incidents that led pixar to look out for other partners. Disneypixar merger a case study analysis international.
Case study solution, case the walt disney and pixar inc. One of the animation companies has international exposure and a history of merger and acquisition and other solely operating in usa with no history of merger and acquisition. Merger of pixar animation studios with the walt disney company. He would also become a member of disneys board of directors. Beginning their relationship, disney and pixar made an agreement that stated they would produce and distribute one computer. Disney as a conglomerate consider the acquisition from a synergistic point of view, whereby allowing for value creation as opposed to value destruction. The walt disney company and pixar inc to acquire or not to.
Disney and pixar merger and acquisitions by gladys. Walt disney pixar case analysis 1439 words 6 pages. Despite nearterm dilution of disneys earnings per share by as much as 10 percent, investors seem focused on the longterm impact to growth in disneys shares. Harvard business school teaching note 711451, november 2010. Disney case free download as powerpoint presentation. Pixar, cofounded by steve jobs, left, and disney, run by robert a.
Disneys acquisition of pixarbusiness strategycase study. A case study of disney and pixar animation studios in 1991, disney and pixar animation studios began a corporate relationship that would lead both companies to great success in years to follow. Its the owner of 11 theme parks and several television networks, includingthe american. Between 98 and 04, pixar contributed to 10% of disneys revenue and over 60% of.
Exxon and mobil 1999, america online and time warner 2000, disney and pixar 2006, and sirius and xm radio 2007. Some key people from pixar were assigned to manage the joint operations of pixar and disney. Strategic management 5301 walt disneypixar analysis the walt disneypixar merger carries a number of convincing advantages for disney, but pixar shareholders should be less enthusiastic about such a deal. One alternative for pixar was to vertically integrate forward and enable distribution of its own content instead of relying on disney by acquiring smaller. Lauren patterson october 7, 20 strategic management 5301 walt disneypixar analysis the walt disneypixar merger carries a number of convincing advantages for disney, but pixar shareholders should be less enthusiastic about such a deal. This case study is brought to you for free and open access by the robins school of business at ur scholarship repository.
The walt disney company and pixar, inc to acquire or not. As such, pixar is a near perfect strategic fit for disney and hence should be acquired by disney to remain competitive. Following this trend, in europe, japanese brewery asahi purchased the rights to beers. The walt disney company and pixar inc to acquire or. Merger between walt disney and pixar 1070 words bartleby. Lauren patterson october 7, 20 strategic management 5301 walt disney pixar analysis the walt disney pixar merger. The acquisition of pixar by the walt disney company. Disney pixar merger a case study analysis free download as word doc. Swot analysis of disney pixar merger intense competition. Pdf assumptions and recommendations on disney, pixar. Pdf disney, pixar merger strategic and competitive analysis. Jan 24, 2006 according to the terms of the deal, disney research will issue 2.
It is one of the largest media and entertainment corporations in the world. Step 2 reading the the walt disney company and pixar, inc to acquire or not to acquire. Disney and pixar merger and acquisitions by gladys claire. Walt disney pixar analysis case study solution and analysis. How to create a successful merger or acquisition a case. Pest analyses is a widely used tool to analyze the political, economic, sociocultural, technological, environmental and legal situations which can provide great and new opportunities to the company as well as these factors can also threat the company, to be dangerous in future. The acquisition would allow disney access to pixars proprietary technology. Rewarding as such a deal could be for jobs, it may be even more valuable to disney. Disney and pixar 2006, and sirius and xm radio 2007. The disneypixar case study is important because it simultaneously reveals the. Case solution,the walt disney company and pixar inc to acquire or not to acquire.
Porters five forces we think that value requires common ownership. Disney alone retained rights to the films and characters. Harvard case study solution and hbr and hbs case analysis. Strategic management 5301 walt disney pixar analysis the walt disney pixar merger carries a number of convincing advantages for disney, but pixar shareholders should be less enthusiastic about such a deal. To write an emphatic case study analysis and provide pragmatic and actionable solutions, you must have a strong grasps of the facts and the central problem of the hbr case study.
Through its highly talented employee pool, culture of. Disney and pixar was nearing end, and iger was able to draw up a plan that both parties could agree on for disney s acquisition of pixar. Pixars resources and capabilities have set a standard that is extremely difficult to imitate. Disney and pixar were already under an agreement to produce six animation movies. What are the risky factors when disney tries to acquire pixar. The walt disney company and pixar, inc to acquire or not to. Pixar s resources and capabilities have set a standard that is extremely difficult to imitate. In disneys case, pixar was assigned the difficult task of turning around a storied animation department that had fallen into disrepair as it struggled to find its footing in a new world of. Companies mergers and acquisition in example of walt disney. Melanio santella professor, organizational behavior graduate school of business, far eastern university in partial fulfilment of the requirements of organizational behavior mba 203 summer, 20092010. Pixar could not get the cash and goods to generate income and, therefore, this merger would allow the firm to unite with disney in order to ease the costs.
Soon after robert iger took over as ceo of the walt. Pixar was the main processor of computer based animation technology of which disney so desperately. For disney, are there any other alternative like strategic alliance better than acquiring pixar. On may 5, 2006 the two esteemed companies disney and pixar merged.
The disneypixar case study given our belief that third space skills map to creative industries, a good case study of how. Pixar s releases have mostly been highly successful and grossed enormous sums at the box office. Agreement and plan of merger this agreement dated as of january 24, 2006, by and among the walt disney company, a delaware corporation parent, lux acquisition corp. The research utilizes a case study approach to evaluate mergers spanning different. Disney case pixar mergers and acquisitions free 30day.
Disney had long coveted pixar before any merger took place. Case analysis the walt disney company and pixar incorporated. Disneypixar merger a case study analysis free download as word doc. Historical backgroundthe walt disney company was founded on october 16th 1923 by brotherswalt and roy disney.
Disneys acquisition of pixarbusiness strategycase studycase. Jul 09, 2017 some key people from pixar were assigned to manage the joint operations of pixar and disney. Pixar and walt disney merger new york mickey mouse and nemo are now corporate cousins. The walt disney company and pixar inc to acquire or not to acquire. The two organizations entered a production agreement which led to films such as monsters inc. But jobs has a far bigger stake in the animation studio than he does in apple. Dec 14, 2009 questions what are the strong capabilities pixar has. Pestel pest analysis of walt disney pixar analysis case solution. The walt disney company and pixar inc to acquire or not. Andrii alekseienko corporate strategy case study 18 september, 2015 the walt disney company and pixar inc. The timing of the pixar merge was ideal for disney.
Furthermore, revenues would increase through merging the companies. Case study solution, history and background walt disney is one of the leading media conglomerates in the world. This case study analyses and differentiates the merger and acquisition strategy for the companies of disney and pixar, in the. In addition, disney collected 10 to 15 percent of each films revenue as a distribution fee. Disney put up the money and helped distribute, while pixar provided the creativity. Patterson october 7, 20 strategic management 5301 walt disneypixar analysis the walt disneypixar merger carries a number of convincing advantages for disney, but pixar shareholders should be less enthusiastic about such a deal. Walt disney pixar analysis case study solution and. In this, disney and warner brothers provide an instructive study in contrasts. Winwin deal the strength of pixar animation was supported by the money of disney and made it a force to reckon with and successful.
However, this partnership later faced problems and pixar started looking out for other partners in. Pdf assumptions and recommendations on disney, pixar merger. With igers hard work and jobs regained trust in disney, they were able to finalize the acquisition of pixar in 2006 barnes, 2008. To answer the main question of the case, we must think of the main problems that it faces.
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