Good lesson. I also take away the crazy acquisitions and empire building go hand in hand with the silly annual report pictures that betray management hubris that is often a massive red flag.
As you mentioned, there was a "diversification" fad running in the mid 80's. Metro's competitor Provigo also did a stupid acquisition (I don't remember which one exactly, but it was totally outside their core business) that weakened their finance and allowed them to be scooped by Loblaws.
The engineering consulting firm Lavalin bought a chemical manufacturing company which almost bankrupted them. Only the merger with SNC saved them.
Good lesson. I also take away the crazy acquisitions and empire building go hand in hand with the silly annual report pictures that betray management hubris that is often a massive red flag.
As you mentioned, there was a "diversification" fad running in the mid 80's. Metro's competitor Provigo also did a stupid acquisition (I don't remember which one exactly, but it was totally outside their core business) that weakened their finance and allowed them to be scooped by Loblaws.
The engineering consulting firm Lavalin bought a chemical manufacturing company which almost bankrupted them. Only the merger with SNC saved them.