Mergers and AcquisitionsCompanies merge and acquire other companies for various strategic reasons with varying degrees of success. The success of a merger is measured by any increase in the value of the acquiring company. The practicalities of mergers often prevent the full realization of the expected benefits and the expected synergy may be lower than expected. This paper examines three examples of recent mergers, the forces that drive companies to buy or merge with others, and the financial results of each case. In May 1998, Daimler-Benz and Chrysler Corporation, two of the world's leading automobile manufacturers, agreed to combine their businesses in what they claimed was a "merger of equals." The merger produced a large automotive company, ranked third in the world in terms of revenues, market capitalization and profits, and fifth in number of units (passenger cars and commercial vehicles combined) sold (Gaughan, 2004). The strategy behind that merger was to allow both groups to maintain their existing cultures. The former Chrysler Group gained the autonomy to produce mass-market cars and trucks, while the Germans continued to build luxury Mercedes. In this case, the merger would offer new products, countries, segments, brands, or expertise and add much more to your business than someone doing the same thing as you (Gaughan, 2004). Despite the significant synergies expected in the short and medium term, DaimlerChrysler reported only low or negative profits after the deal. The loss of $5.8 billion in 2001 was the largest in the history of the German economy. By last year, the combined market value of the merged entity had fallen to about half the value of their separate valuations in 1998. Rivals such as BMW, Renault and Nissan, however, managed to improve in 2004 despite the same difficult context (Mermigas, 2002). But the merger with DaimlerChrysler was a financial black hole for the company; Its market value plummeted 40% from $84 billion to $47 billion after the merger and is far from meeting Daimler's prediction that the merged entity would become the world's most profitable automaker ( Landler, 2005). AOL's $165 billion acquisition of Time Warner was structured to transform the once independent Internet into a cornerstone of the mainstream media system, validating the Internet's role as a leader in the new world economy while redefining same as the next generation of digital-based leaders will be (Mermigas, 2002). The deal, announced in 2000, featured an unusual merger structure in which each original company merged into a newly created entity "AOL Time Warner".