Definition
The illusion that combining two companies will create value through elimination of redundancy and cost-sharing. Usually results in the opposite—chaos, talent loss, and duplicate spending.
Example Usage
We fell into the synergy trap with that acquisition, thinking we could consolidate operations and save millions.
Origin
Criticism of synergy-based M&A strategy; popular term in post-acquisition analyses
Fun Fact
80% of acquisitions fail to achieve projected synergies, yet companies continue pursuing synergy-based deals
Source: M&A and corporate strategy analysis
Related Terms
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See “Synergy Trap” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.
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