(SINGAPORE) With billions of euros pouring into merger and acquisition (M&A) deals, you would expect the European businesses making the investments to get at least a decent return for their money - at least in kind, if not in cash.

Surprise! The Hay Group, a management consultancy with offices in 47 countries, found only 9 per cent of 200 companies it recently polled in Europe achieving all their original goals in M&A deals sealed in the past three years.

If so many of the Europeans called it wrong and got so little out of the M&As they made, what about their Asian counterparts?

M&A activity is certainly picking up in booming Asia, fanned by the rise of China and India as the next economic giants. Gaurav Lahiri, who tracks and advises on M&A deals in the region for Hay in Singapore, says that M&A is the best strategy that firms here can adopt in going regional or global.

But Asians are relatively new to the M&A game, unlike the Europeans who, for their experience alone, should have a better chance of success in M&A deals. What's more, the Europeans are old hands at running businesses and tend to be more sophisticated in managing a corporate marriage,

European companies can more readily turn to specialists for counsel in M&A activities. A more transparent climate also gives the Europeans an edge in seeking out more suitable M&A targets.

Singapore, with its modern business environment and practices, may be an exception to some extent. But the conclusion drawn for M&A deals in developing Asia seems clear - the success rate is likely to have been even more dismal.

Now, Asians could have achieved more success in M&A because they have the luxury of learning from the Europeans and side-stepping their errors. Yet, lessons were also there for the Europeans to learn, but they still persisted in making mistakes.

David Derain, who oversees M&A activities at Hay, speaks of the 'knowing-doing' gap. It's not as if Europeans companies in M&A deals are totally ignorant of what needs to be done to ensure success; they know. But there's a big difference between knowing and doing something about it.

It's already widely recognised that M&As often lead to disappointment and failure because buyers often overlook intangible assets like corporate culture, governance, brand and client loyalty, and leadership and employee engagement and productivity.

'Indeed, (European) business leaders seem only too aware of the risks inherent in failing to pay due attention to these intangible aspects of the merger process,' Hay says in a report of its poll results. Over half - 54 per cent - of those polled acknowledged that this negligence significantly raises the danger of making a wrong acquisition.

Another consequence is the lack of support for the merger in the acquired company. The Hay poll shows that nearly half of the acquired leadership opposed the mergers they experienced. A worrying 30 per cent reported they had actively resisted them.

Often, it's a case of old habits die hard when European companies focused on traditional due diligence and failed - with 70 per cent of those polled admitting this - to audit the intangibles assets of the target company altogether.

Is Asian management so steeped in the old way of doing things that companies here have also taken the easy and convenient way out when it comes to checking out a company to buy? They - including Singaporeans - have made progress in bringing their businesses up-to-date with the modern world. But this often meant ape-ing the West, and copying their bad habits.

To be sure, the fact that many Asian firms have been able to perform better than the Europeans and Americans is proof that businesses here can be disciplined and well-managed.

Still, it is largely Western management tools they employ - and these, the Hay poll shows, are inherently inadequate in cracking the problem of measuring the intangibles in a M&A investment.

A more transparent business environment, a robust form of reporting on business culture, human capital and organisational structures as part of the due diligence process will help, but Asia is generally still behind in these matters.

It's the same with business leadership, which the Hay poll pinpointed as another key factor in the difference between success and failure in M&A deals. 'The capacity to align merging organisations - in particular the intangible assets - rests primarily with the top team,' says Mr Derain.

Here again, there is a 'knowing-doing' gap. Companies know leadership is key to the success of a M&A deal. But picking the right leaders is tough, because leadership is intangible. Besides, they are hard to come by - even in heavily populated and well-educated Asia.