Nearly Half of Corporate Mergers End in Breakup, MIT Research Finds

Nearly Half of Corporate Mergers End in Breakup, MIT Research Finds

Corporate mergers are failing at an alarming rate, with nearly half of all M&A deals eventually unwinding after an average of 10 years, according to new research published in MIT Sloan Management Review. The findings, released this week by researchers Henrik Cronqvist and Désirée-Jessica Pély, reveal that these failed combinations ultimately destroy shareholder value and consume significant leadership attention during their protracted unraveling.

For CFOs navigating today's dealmaking environment, the research offers a sobering reality check: the odds of a merger surviving long-term are roughly equivalent to a coin flip. The study identifies poor initial fit and unforeseen disruptions as the primary culprits behind merger failures, suggesting that many deals are fundamentally flawed from conception rather than merely suffering from poor execution.

The decade-long timeline for these failures is particularly noteworthy. Unlike outright disasters that collapse within months, most troubled mergers limp along for years, creating what amounts to a slow-motion value destruction that can be difficult for boards and investors to detect in real time. This extended deterioration period means finance leaders may be managing integration challenges and reporting combined results long after the strategic rationale has evaporated.

The researchers have developed what they describe as a "research-backed framework" designed to help executives diagnose which deals are structurally sound and which are likely to fall apart. The framework focuses on identifying warning signs early in the merger lifecycle, when course corrections or even abandonment remain viable options.

The timing of this research is significant. As of February 2026, finance leaders are operating in an environment where AI-driven analytics and accelerated business model shifts are adding new layers of complexity to merger integration. The traditional playbook for evaluating deal synergies may no longer capture the full spectrum of risks that can emerge over a 10-year horizon.

What makes this research particularly relevant for finance executives is its emphasis on initial fit rather than integration execution. The implication is that many CFOs may be spending enormous energy on post-merger integration plans for deals that were never going to work, regardless of how well the finance systems were combined or how smoothly the accounting policies were harmonized.

The shareholder value destruction cited in the research should give pause to any finance leader preparing board materials for an acquisition vote. When nearly half of deals eventually unwind, the burden of proof for demonstrating strategic fit becomes considerably higher than current practice might suggest.

The research appears in MIT Sloan Management Review's latest issue, which covers topics including scenario planning, innovation, and responsible AI. For CFOs, the key question emerging from this work is whether their due diligence processes are sophisticated enough to identify the structural incompatibilities that lead to eventual breakups, or whether they're primarily focused on near-term financial metrics that may obscure longer-term strategic misalignment.