General Electric S Recent Takeovers

GE's Recent Acquisitions General Electric Co. has developed to become the most acquisitive industrial firm across the globe since its inception. The company is renowned for spending huge amounts of money on takeovers or acquisitions as part of its strategy to ensure increased growth and profitability. In essence, General Electric's acquisitions are fueled by the focus on ensuring good returns across its operations through obtaining a considerable market share and competitive advantage.

Acquisitions are important strategies in the company's operations given that they are regarded as initiatives that enhance organic growth. In the past few years, General Electric has made several acquisitions including the acquisition of Dresser Inc. and Alstom. GE's Acquisition of Dresser Inc. General Electric completed a $3 billion takeover of Dresser Inc., which is an international energy infrastructure technology and service provider in 2011 (Reuters, 2011). This acquisition transformed the international energy portfolio of GE by expanding its energy offerings and industrial customers throughout the world.

Following the acquisition, GE enhanced its focus on research and development to Dresser's tailor made solutions and provided an opportunity for workers to significantly expand their businesses. Reasons General Electric's acquisition of Dresser Inc. is justified by the need for growth, which is the reason for the takeover. This acquisition was geared towards increasing GE's market share without necessarily having the company to do it by itself. Actually, this takeover focused on promoting GE's growth by enhancing its offerings for energy and global industrial customers.

Sources Generally, companies usually experiences integrations difficulties following mergers and acquisitions because of several reasons and factors. These integration difficulties occur during the post-acquisition phase and usually occur in different forms. Some of the most common difficulties include challenges in establishing effective working relationships, different financial and control systems, and combining dissimilar corporate cultures. The source of integration difficulties that is seemingly of concern in GE's acquisition of Dresser Inc. is working relationships. This is primarily because General Electric has different management styles as compared to Dresser Inc.

While the companies are a natural fit together, they have different management styles, particularly because Dresser has custom solutions for its employees. This would present integration difficulties since GE would need to understand these solutions and develop management styles that promote effective working relations with GE's employees. GE's Acquisition of Alstom The second recent acquisition by General Electric is its takeover of Alstom SA, which was supported by the French government in 2014 for $13.5 billion.

The acquisition of Alstom SA was geared towards expanding General Electric's power business though Alstom was already making losses in its power engineering business. Notably, GE did not completely absorb Alstom's businesses but focused on its bulk operations i.e. gas turbine and steam turbine businesses (Team, 2014). Reasons Similar to the previous takeover, GE's acquisition of Alstom SA was centered on growth of the company's market share. This would occur through expanding its power business by absorbing Alstom's gas turbine and steam turbine businesses.

While the acquisition occurred at a time when Alstom was struggling to make profits in its power businesses, the takeover was carried out on the belief that it would help GE expand its power business and generate profits. Sources The source of integration difficulties that is of concern in GE's acquisition of Alstom is financial and control systems. General Electric will seemingly face difficulties in linking its financial and control system with that of Alstom.

This is a concern that would generate integration challenges because the current financial and control system at Alstom has been characterized with significant losses to an extent that the firm was considering shutting down its power businesses. In essence, it seems that Alstom's losses have been fueled by relatively ineffective financial and control systems, which would result in considerable problems for General Electric in the post-acquisition stage. Summary General Electric's acquisitions of Dresser Inc. and Alstom provide important lessons regarding strategic development through mergers and acquisition.

First, these takeovers show that acquisitions can be part of strategic development.