Privacy Please place the order on the website to order your own originally done case solution. The two organizations entered a production agreement which led to films such as “Monsters Inc”: Disney put up the money and helped distribute, while Pixar … The deal was unique in that the two companies had very complementary competencies and had been in a strategic partnership for 15 years prior to the merger. One of the core weaknesses revealed in the decade following Disney's early-90's animation renaissance was the lack of elasticity in its animation department.   Terms. Pixar and Walt Disney Merger just from $13,9 / page. 2020. Walt Disney-Pixar Merger Brief Industry Analysis Because of the technology nowadays, one successful film can be distributed all over the world, which is in a form of motion pictures or DVD. > Harvard Case Study Analysis Solutions >> Case – The Walt Disney and Pixar Inc. of big-money, yet failed mergers, the Disney Pixar merger stands out as one that has succeeded and created the elusive ‘synergies’ that every acquirer looks for. (LELAND, 2007). The acquisition of Pixar by Disney in 2006 is an example of vertical merger, which is best described as a merger that occurs between two firms that work at separate and distinct stages of the production process. But this didn't all come easily. Pixar has new animated and innovative ideas of movies however,the company is facing difficulty in raising finance for the project. The New York Times, Oct 12. Purchase at such a high price reveals Disney’s eagerness to gain Pixar’s animation capabilities, talent and the creativity culture that are the latter’s unique features. It is one of the largest media and entertainment corporations in the world. Retrieved from Since then it has been reported as one of the most successful mergers of times. Electronic Inspiration LLC. In terms of business, Disney is a distributor of films, while Pixar is a production studio. DePamphilis, D.M. ", Walt Disney CEO Michael Eisner has famously, touted the benefits of synergy, saying, “One plus, one will add up to four,” when Disney bought, It increased the overall welfare of both the Disney and Pixar. References The Boards of Directors of Disney and Pixar have approved the transaction, which is subject to clearance under the Hart-Scott-Rodino Antritrust Improvements Act, certain non-United States merger control regulations, and other customary closing conditions. Disney's Retail Plan Is a Theme Park in Its Stores. Branding of films-Disney Pixar. Gannon, G. 2007. Weaknesses: October 7, 2013 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. Copyright 2020  . Disney’s acquisition of Pixar had always proved to be fruitful and had resulted in the production of several blockbusters. Barnes, B. Academic Press. Disney had an equity stake in Pixar, which came with a contract to produce three films. The Walt Disney Company was founded on October 16 th 1923 by brothers Walt and Roy Disney. Merging together two large, successful companies has the potential to create barriers in organizational change. For instance, I believe that the decision to expand onto other continents was extremely wise as it not only increases profits, but it protects the company against economic features that might affect, Perhaps more than any of the media and entertainment conglomerates with which it competes, Disney has created a prolific, colorful and always expanding universe of characters that draw immediate recognition and appeal. The benefits for Pixar in such an acquisition were that Pixar could access Disney’s marketing and distribution capabilities. Analysis The merger between Disney and Pixar generated both positive and negative implications for the company culture. On Disney's Pixar Acquisition: Pricey, But Worth It. Which is greater: the value of Pixar and Disney in an exclusive relationship, or the sum of the value that each could create if they operated independently of one another (but were allowed to form relationships with other companies)? get custom paper. (LELAND, 2007) By combining with Disney, the financial problem will be resolved as Walt Disney has good cash reserve which can be transferred internally within the group. Knowledge @ Wharton, Feb. 22. ("Mergers and Acquisitions: Why They Can Fail," 2006, Investopedia) The Disney-Pixar Merger . The problem here is that Disney had lost the animation culture they once had. Retrieved from This has been the relationship between the two companies, Creating an economy of scale can prove difficult, and the new, larger entity can be unwieldy. Disney, however, will have to confront several risks in achieving the goals of this acquisition. Today, Woody and Buzz Lightyear are as recognizable as Mickey Mouse and Donald Duck. The merger in May 2006 ensured that Disney still received Pixar’s technology . . For example, independent film distributor and makers have the license to make a film and the cost of license is fixed, therefore the maker intends to make additional movies on a single license to reduce the cost of license per film. This preview shows page 10 - 14 out of 28 pages. Retrieved from, "Disney And Pixar Disney's Acquisition Of Pixar" (2010, October 16) Retrieved November 2, 2020, from, "Disney And Pixar Disney's Acquisition Of Pixar" 16 October 2010. In the next two sections, the detailed analysis of the companies Disney and Pixar are considered with respect to the acquisition regarding the view … Both companies have different ideas for the production of new and innovative animated movies. The merger between Disney and Pixar was more specifically known as a vertical merger. At, we provide students the tools they need to streamline their studying, researching, and writing tasks. Financial risks of merging with, Disney and Pixar The stock has surged more than 10 percent so far this year on takeover speculation. needed in order to make their production line more efficient.