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Increases economies of scale and should lead to an improved mix of skilled people. Could broader both the product line and the distribution network.
Creates cultural conflicts and frequently interpersonal conflicts (Blue team vs. Red team). Creates extra management layers and other dis-economies of scale. Significant costs are incurred to achieve economies of scale (converting to a singel set of systems, for example). Customers of Company ABC may hate Company XYZ and leave the merged company to go to another supplier.
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