Re: criticism of exxon-mobil proposed merger

[rlande@UBmail.ubalt.edu]

> The purported "economies of scale" from the merger are fallacious. If
> either or both of the companies have excess refining capacity, they can
> sell and close their facilities without a merger. If they are
> bureaucratically bloated, they can shrink their corporate offices without
> merging. They can and do have numerous joint ventures in every aspect of
> the business. The merger is completely unnecessary to achieve
> efficiencies, and it is motivated entirely by a desire to limit
> competition.

The notion that Exxon is not big enough to be efficient strikes me as
silly.  Companies often want to merge for other reasons and claim bogus
efficiencies as the supposed reason for the merger, but rarely can they
prove their claims. More likely something else is going on.  So, what is
their real motivation?  Perhaps market power.  Perhaps Exxon would rather
buy reserves than explore for additional oil--  Any other possibilities?

Bob Lande