Whether it's small "tuck-in" acquisitions, large megamergers between industry giants, or even a company taking a significant stake in another one, the urge to merge remains strong.

We can't always tell the good deals from the bad. While a merger might give us "synergy," we can just as easily get what investing legend Peter Lynch called "de-worse-ification": weakening an existing business's core competency by grafting on wildly unrelated subsidiaries.

Breaking down the buildup
We're going to take a shortcut to decipher the good deals from the dealbreakers, by seeing how the 76,000 investors in the Motley Fool CAPS universe rate companies that are hooking up. If two highly rated companies seek a better life together, we figure they might also do better down the road. Conversely, if one company is highly rated in CAPS and the other low, we might expect one set of investors to come out ahead, since those ratings include investor sentiment of future prospects.

Could troubles in the capital markets finally be taking their toll in the merger-and-acquisition arena? Though the deals won't stop, expect to see more stock swaps playing a role in financing transactions, given the loss of easy credit.

Here's a handful of some of the recently announced deals, and the CAPS community's ratings for the players involved, on its scale of one to the maximum five stars:

Acquirer

CAPS Rating (Out of 5)

Target

CAPS Rating

Deal Price

Agrium (NYSE:AGU)

*****

UAP Holding

***

$2.1 billion

VeraSun Energy (NYSE:VSE)

*

US BioEnergy (NASDAQ:USBE)

*

$682 million

Vivendi

NR

Activision (NASDAQ:ATVI)

*****

$18.9 billion

ArecelorMittal (NYSE:MT)

*****

OFZ

NR

NA

SK Telecom (NYSE:SKM)

*****

Hanaro Telecom

NR

$1.2 billion

CAPS ratings courtesy of Motley Fool CAPS. NR = not rated.

While worldwide merger activity rose in November to $286.1 billion (after BHP Billiton's offer for Rio Tinto was rejected), U.S. deal volume declined 73% from a year earlier to $51.1 billion, bringing things back down to the lows reached in August and September. That decline is also being reflected this month. Deals announced over the past week were pretty light, in keeping with the deals from the week before. Yet as the credit crunch deepens, a number of investors are looking to back out of previously announced deals. Private equity may soon have to prove to boards of directors that it won't be backing out of acquisitions when things get tough.

So what do CAPS investors think about these targets and acquirers? While these deals are somewhat larger than we've seen recently, with most exceeding $1 billion in value, most of the companies doing the buying are generally in investors' good graces, having garnered ratings of five stars.

Game on!
Perhaps the biggest news also involves the biggest merger of the week: Vivendi's acquisition of Activision in a bid to take on Electronic Arts (NASDAQ:ERTS) as top gamer. Melding Guitar Hero into World of Warcraft, the complicated transaction will ultimately create the largest gaming company.

More than 1,200 CAPS players have rated Motley Fool Stock Advisor recommendation Activision, with 97% of them viewing it as an outperform. CAPS All-Stars, the players with the best investing records, are also enthusiastic about the game maker; 98% of our All-Stars give it an outperform endorsement.

The merger has CAPS investors stoked, including All-Star stevendecker, who sees the company as much better positioned to take on rival Electronic Arts as a result:

Value play: Great merger with huge potential. Blizzard is a cash generating machine and hands down the best game developer in the industry. Both sides of this merger have been performing well continuing growth if Activision where ERTS has flattened. Consider this: Similar Expected sales in '07 $3.8B(ATVI) vs. $3.1B(ERTS) and Similar Mkt Cap $18.9B vs. $17.1B but much better Margins. The Blizzard side of the merger is working on 40%+ margins vs ERTS best of 20%. Expect some margin pressure on ATVI as more MMOs are released.

That's echoed by another CAPS All-Star, ViciousChicken, who sees reasons for EA to be worried:

Starcraft II will be one of the best selling games of all time. WoW will continue to provide a solid revenue stream. EA should be a bit concerned.

Ultimately, this deal seems to be a first-person shooter destined to raise the stakes in an already hot industry.

A value-added offer
What's your take on these deals? Should investors accept the cash or take stock in the new company, if offered? Only at Motley Fool CAPS is your opinion as valuable as those of the pros. Tell the CAPS community whether the urge to merge is good to go -- or whether it would be better to fight for independence.

Activision and Electronic Arts are Stock Advisor recommendations. Take a 30-day risk free trial subscription to brighten up your portfolio. SK Telecom is a Global Gains pick. Fool contributor Rich Duprey does not have a financial position in any of the stocks mentioned in this article. You can see his holdings here. The Motley Fool has a disclosure policy.