The Perils of IntegrationThe Perils of Integration
The share price of American Medical Systems Holdings Inc. (Minnetonka, MN) took a pounding yesterday over concerns about problems with integrating Laserscope, a company it bought last year, reports the Star Tribune of Minneapolis.
October 31, 2007
After the firm announced it is cutting its 2007 sales and profit forecasts, Wall Street analysts downgraded its stock, and the price promptly fell by 29%, the largest one-day drop in company history.The main problem appears to be a failure to properly integrate Laserscope's sales force into American Medical Systems. If your sales force isn't functional, you're simply not going to get the revenues and profits you want. This should be a lesson to all firms that are considering an acquisition that might be biting off more than it can chew.
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