Analysis: Pricing Hike Post-Merger in Two Cases
Pulse
Octopart Staff
Oct 10, 2017

Last week, Vishay announced that it's acquiring MCB Industrie S.A, a manufacturer of specialty resistors. Acquisitions have been a key piece of Vishay's strategy, so we took a look at its track record to see the effect on market pricing of the target company's products. (We used Octopart's historical pricing data.)

Here's Huntington Electric's resistor product line, which Vishay acquired in September 2011: p>

Huntington

The chart above shows average price changes from one month prior to the announcement to five months after, using the average price on the announcement date as the baseline. While this looks interesting, the small sample size (Octopart carries pricing data for fewer than 1,000 Huntington resistors) gave us some heartburn so we took a look at another recent acquisition with significantly higher volume.

Thomas & Betts, acquired by ABB : p>

Thomas

In both cases, we see initial price fluctuation post-announcement, then big increases in the following months. While the long-term impact on pricing is highly dependent on the specific acquisition scenario and goals, price hikes in the short-term post-announcement could reflect market uncertainty over product availability or changes.

If you have questions or feedback on this exercise, please leave us a comment or email us. If you'd like to help us open up access to information in electronics part sourcing, send us your ideas on topics you're interested in and we'll take a look.

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