When we think of investments, our minds often jump to the stock market, investors, venture capitalists, or the show Shark Tank. We frequently hear about huge deals and outcomes for businesses trying to excel in the market or stock investments that lead to huge payouts for investors who seem to have all the know-how and luck.
It’s easy to forget that entire organizations can invest in other businesses or organizations to increase profitability and diversify their portfolios. Organizations often have the most significant investment deals in history, particularly if they’ve acquired or merged with another organization. Of all the major investment deals, these eight are the biggest ever made.
1. Vodafone Acquires Mannesmann AG ($180.95 Billion)
In 1999, the largest investment deal ever made began taking shape with Vodafone, a British telecom company, seeking to buy out Mannesmann AG, a German industrial giant. Vodafone sealed the deal by spending $180.95 billion to add the company to its roster in 2000.
The deal was significant for multiple reasons, and the impressive price tag was just one of them. It was also the first time such a large company sought to purchase another major organization without it being solicited or available on the market. The purchase also represented a major global shift in the presence of telecom companies operating internationally, which we’re far more familiar with today.
2. America Online (AOL) Acquires Time Warner Inc. ($165 Billion)
The infamous acquisition of AOL and Time Warner was cemented in 2000 with AOL’s massive $165 billion bid. In theory, it seemed that bringing these two organizations together—one an internet provider and the other a media publishing giant—would be a success story. Unfortunately, this ended up being far from the case. The companies separated and went their own ways in 2009.
One of the reasons for the failed acquisition was the burst of the dotcom bubble, in which AOL had been thriving shortly before the acquisition.
3. Verizon Communications Acquires Verizon Wireless from Vodafone ($130 Billion)
In 2013, another major merger and acquisition occurred in the telecom industry: Verizon Communications took over control of Vodafone’s Verizon Wireless, which operated in the United States. The deal marked the end of Vodafone’s presence in the States, which it had been building in the decade leading up to this deal, and massive growth for Verizon Communications, which continues to be a significant player in the US telecom marketplace.
4. Dow Chemical Acquires DuPont ($130 Billion)
A massive deal took place in 2017 when Dow Chemical merged with DuPont for $130 billion. The chemical companies that were previously competitors ended up complementing each other’s work, making the merger a natural fit and giving them a stronghold in the chemical market, most notably in the production of pesticides and herbicides.
The result was incredible annual profits for the now joint organization and shared research and development resources, which are highly valuable in the chemical industry. Though the merger was highly profitable, the companies have since split into three different organizations, each with a specific focus.
5. Anheuser-Busch InBev Acquires SABMiller ($104 Billion)
In 2016, just a year before the impactful Dow Chemical and DuPont merger, the brewer SABMiller was acquired by Anheuser-Busch InBev, the largest brewer in the world. This impressive acquisition cost $104 billion and helped push Anheuser-Busch InBev into its world leader position. This meant that a single-parent company now produced many of the most popular beers worldwide and reaped their profits.
6. Pfizer Acquires Warner-Lambert ($90 Billion)
The giant pharmaceutical company Pfizer may have become a household name for developing one of the first approved COVID-19 vaccines, but it also made history with one of the world’s largest mergers and acquisitions in 2000 when it acquired Warner-Lambert. Warner-Lambert was another major pharmaceutical industry player in the United States, with roots dating back to the 1950s. Pfizer spent three months trying to acquire the organization before the deal went through.
7. AT&T Acquires BellSouth ($86 Billion)
In 2007, the internet and phone service provider AT&T successfully acquired BellSouth for $86 billion, even amid concerns about how much power and influence this would give AT&T in the market, particularly how it would affect consumer options and prices. The acquisition led to AT&T shares growing in value, and the company has a hold of over 66 million phone lines and 11 million internet customers.
Today, AT&T remains one of the leading telecommunications providers in the United States, with an annual revenue of over $123 billion. It closely follows its competitor Verizon, which has also fared well post-major merger and has an annual revenue exceeding $168 billion.
8. Exxon Acquires Mobil ($75.3 Billion)
In November 1999, Exxon acquired Mobil for $75.3 billion and became known as ExxonMobil Corporation. Both companies were key organizations in the oil and gas industry. They were the largest two oil and gas providers in the US, and they came together to create a massive organization with incredible power and influence on the US economy. As with the AT&T and BellSouth merger, the merger of Exxon and Mobil was met with concern and faced regulatory review.
The company continues to thrive in the industry and has most recently acquired another oil and gas supplier, Pioneer Natural Resources, for a much more modest-sounding investment of $59 billion.
Conclusion
Across industries as diverse as pharmaceuticals, energy production, casinos, and brewers, companies investing in other organizations have long been a powerful investment strategy that blows other investment options out of the water. These mergers and acquisitions have led to multibillion-dollar deals that frequently enhance companies’ portfolios, giving them even more wealth and influence in their industry.