Mergers and Acquisitions

Merger & Acquisitions

MEGE AND ACQUISTION

Merger and Acquisition

Merck & Company Inc. is an American pharmaceutical company operating in different countries globally. The company is one of the world largest manufacturers of drugs by revenue and market capitalization, and the company offers different products such as vaccines, prescription products, consumer products and animal products. Its operative business is being operated by MerckKGaA where 30% of the shares are publicly traded and the Merck's family owns 70% of the company interests. Merck operates four different business divisions such as Consumer Health (over-counter pharmaceuticals), Merck Serono (biopharmaceuticals), Merck Millipore (pharmaceutical research & technology products) and Performances Materials (high-tech chemicals). (Merck, 2011). Typically, the company Consumer Health division offers quality products globally and its brands are available in countries in the North and South America, Europe, African and Asia. Over the years, the company has long known to improve people's health and…… [Read More]

Mergers and Acquisitions M& a and Corporate Restructuring

Mergers and acquisitions (M&A) and corporate restructuring are a big part of the corporate finance world. Every day, Wall Street investment bankers arrange M&A transactions, which bring separate companies together to form larger ones. When they're not creating big companies from smaller ones, corporate finance deals do the reverse and break up companies through spinoffs, carve-outs or tracking stocks.

Not surprisingly, these actions often make the news. Deals can be worth hundreds of millions, or even billions, of dollars. They can dictate the fortunes of the companies involved for years to come. For a CEO, leading an M&A can represent the highlight of a whole career. And it is no wonder we hear about so many of these transactions; they happen all the time. Next time you flip open the newspaper's business section, odds are good that at least one headline will announce some kind of M&A transaction.

Sure, M&A…… [Read More]

Mergers and Acquisitions as a CEO You

Mergers and Acquisitions

As a CEO, you are trying to acquire a foreign firm. The size of your firm will double, and it will become the largest in your industry. What does your firm do and what does the foreign firm you are trying to acquire do? Where are the firms based?

Before any M&A proceeding should occur. An analysis of the macroeconomic factors and industry related factors should be conducted. In this particular M&A case, as CEO, my primarily job is chief risk officer. Here, I do not want to overpay for a company with underlying operational issues that I am oblivious too. The M&A team must first place a value on the business that corresponds to the synergy or business enhancements it will provide. This figure must also include a margin of safety in order to prevent overpaying for the company in question. For example, if the underlying…… [Read More]

Mergers and Acquisitions the Most Recent Worldwide

Mergers and Acquisitions

The most recent worldwide economic meltdown that began in 2007 decimated the auto industry. Chrysler and GM were two of the 'big three' that did not escape without filing bankruptcy and restructuring; shedding thousands of jobs and debts in the process. Ford managed to escape this fate and the accompany government take-over but also suffered tremendous loss in terms of sales and employees. At the height of the recession sales of U.S. vehicles had plummeted by nearly a third; with GM falling by 45%, Ford 30% and Chrysler 35% (BBC News online, 2009).

If anyone was projecting the recession; their warnings went unheeded while investing continued at breakneck speed until the economy sputtered to a standstill. It resulted in some formidable takeovers including the loss of the Jaguar and Land over luxury brands by Ford to Tata Motors Ltd. (TML). The former is known for its luxury…… [Read More]

Merger and Acquisition Mergers and Acquisitions Mergers

Merger and Acquisition

Mergers and Acquisitions

Mergers and acquisitions (M&A) is an aspect of business strategy dealing with the amalgamation of two or more companies of similar entities or buying, selling or dividing different companies. Despite several common features of M&A, there is still a distinction between the two concepts. Merger is the amalgamation of two businesses of equal or nearly equal sizes; however, acquisition is the takeover of entire business of small firms by big firms. Similar to other industry, M&A has become a valuable tool that healthcare sector use in driving sustainable clinical and financial outcome. "Healthcare mergers are increasingly being considered as a possible solution to creating sustainable and patient-centric service models." (Carter, 2011 P. 3). If done right, merger and acquisition is a tool that healthcare provider employ to enhance competitive market advantages.

Fundamental objective of this paper is to investigate how the merger and acquisition…… [Read More]

Mergers and Acquisitions Organizational Characteristics

International mergers and takeover processes are positively influenced by efficient control by the parent country which may lead to the formation of a direct link between protection of investors and a companies' access to debt financing (La Porta et al., 1998 as cited in Martynova and enneboog, 2008). Martynova and enneboog in the year 2007 explained that debt financing is directly related to merger and acquisitions across the border (Martynova and enneboog, 2008).

Lastly, a major chunk of the findings identified that the impact of the comparative size of transactions, ways of paying, free cash flow, strategies of diversifying, hostility, variations in economic development, proximity, stock price run up and the association with language are some of the factors that need to be considered by both the target and the bidder company (Martynova and enneboog, 2008).

The respective analysis brings value to the overall text in mainly two ways. Firstly,…… [Read More]

Mergers and Acquisitions A Risk

Perhaps the biggest struggle entities face aside from legal rules and regulations that may be different between the target and bidding company (Galpin & Herndon, 2001) is the integration of two company's organizational cultures and beliefs (Daniel & Metcalf, 2001). Most H Managers and strategic planners argue that people are the most important part of any organization. When two companies merge and incorporate a group of people with differing cultures and identities, many companies find it difficult to change the culture and identity one company has relied on for so long in a way that allows for integration of the bidding company's organizational culture (Daniel & Metcalf, 2001).

Conflict always arises in mergers and acquisitions, but cultural conflict is often more prevalent when M&as involve international trade and relationships. To help manage cultural differences, each company must focus on collaborating with one another to discover the similarities and differences that…… [Read More]

Mergers and Acquisitions An Overview

Creating an economy of scale can prove difficult, and the new, larger entity can be unwieldy. Again, using stock to finance the deal can be its downfall "a booming stock market encourages mergers...Deals done with highly rated stock as currency are easy and cheap, but the strategic thinking behind them may be easy and cheap too." ("Mergers and Acquisitions: hy They Can Fail," 2006, Investopedia)

Financial risks of merging with or acquiring an organization in another country and how those risks could be mitigated

Globalization," defined as "the arrival of new technological developments or a fast-changing economic landscape that makes the outlook uncertain are all factors that can create a strong incentive for defensive mergers. Sometimes the management team feels they have no choice and must acquire a rival before being acquired. The idea is that only big players will survive a more competitive world." ("Mergers and Acquisitions: hy They…… [Read More]

Mergers and Acquisitions Organizational Culture

Similarly, the simple fact is that with a merger nothing remains static forever -- growth cannot occur unless flexibility occurs.

Some flexibility is required here, and there may be times when transfers will need to be solidified.

Technology

In most cases, systems and technology will improve based on greater efficiencies. However, it is also likely that basic input and programs will require change and flexibility as well -- what two companies use exactly the same system in exactly the same manner?

This issue may interfere with the efficiency of individual department for the short-term. However, the phase period of merging should allow for adequate time to learn about their new positions, technical needs, etc.

Quality

Both organizations are committed to the highest quality possible; it is in their respective strategic plans. It is important to focus on ways to improve quality, not interagency competitiveness.

The bottom line needs to be…… [Read More]

Mergers and Acquisitions the Case

ibliography

Amos Web Dictionary, Gloss arama, Merger, http://www.amosweb.com/cgi-bin/awb_nav.pl?s=gls&c=dsp&k=merger, last accessed on February 28, 2007

Wikipedia, the Free Online Encyclopedia, Mergers and acquisitions, Due Diligence, Procter&Gamble, http://en.wikipedia.org/,last accessed on February 28, 2007

CNN Money, Results of Weekly Pole, 2005, Chris Isidore, P&G to buy Gillette for $57, CNN Money, January 28, 2005, http://money.cnn.com, last accessed on February 28, 2007

Procter&Gamble buys Gillette to Form the World's iggest Consumer Products Group, FinFacts Ireland, usiness&Finance Portal, January 29, 2005 http://www.finfacts.com/cgi-bin/irelandbusinessnews/exec/view.cgi?archive=2&num=292,last accessed on February 28, 2007

Christine Spivey Overby, George Lawrie, Procter&Gamble buys Gillette, Forrester Research, January 28, 2005, http://www.forrester.com/Research/Document/Excerpt/0,7211,36326,00.html, last accessed on February 28, 2007

James M. Kilts, Answers.com, usiness iographies, 2007, http://www.answers.com/topic/james-m-kilts, last accessed on February 28, 2007

Andrew Caffrey, Investors ack Gillette, International Herald Tribune, usiness, June 29, 2005, http://www.iht.com/articles/2005/06/28/business/gillette.php, last accessed on February 28, 2007

Chris Isidore, P&G to buy Gillette for $57, CNN Money, January 28, 2005 http://money.cnn.com/2005/01/28/news/fortune500/pg_gillette/,last accessed…… [Read More]

Mergers and Acquisitions in Health

Impact of Mergers and Acquisitions on the Health Care Workforce

Workers in health care, because of the conversion of health care into a commercialized business in many respects, have found themselves exposed to the same opportunities and problems that face workers in the rest of the working world. Because of the fact that certain types of health care workers are in high demand, many of these workers will quickly switch jobs and be more likely to expose the organizations to staffing shortages unexpectedly. Additionally, from the viewpoint of the employers, mergers and acquisitions often create massive layoffs or pay cuts, due once again to the view of health care as a business rather than public service (Ginsburg, 1996).

Also, the bottom line to consider, in addition to all of the affects on the health care workforce, is the impact that the workers pass along to the patients.

Impact of Mergers…… [Read More]

Mergers and Acquisitions the Situation

06 or 56.1% to $2.95 while Zhone shares fell down to $2.90 or 18%. Yet, of the new company, Zhone shareholders will own 63.2% and Paradyne shareholders will own 36.8%. (Zhone to Buy Paradyne in Stock-Swap Deal, Says 2Q)

Even the Paradyne seniors are being retained and the Chairman and Chief Executive as also the Chief financial Officer will remain as consultants for a period of two years. The analysis by financial experts showed that Zhone will lose 2 cents per share on total revenue of $29.3 million. The earlier performance had been also bad with a loss of 6 cents per share on sales of $21 million. Paradyne stated that its performance will improve, but analysts say that the results will be a loss of 1 cent per share and revenue of $27.3 million and this was down from an income of 1 cent and $24 million which it…… [Read More]

Mergers and Acquisitions Play an

he most popular amongst these options is satellite television. Satellite television can be advantageous to consumers because there are more stations available to choose from and the price is the same or similar to that of cable television companies.

Most recently the Internet has changed the manner in which people access the news, communicate with one another, and watch television programs. As a result cable television companies have attempted to adopt new business models that often involve mergers and acquisitions. hese mergers and acquisitions can take place between cable television companies to create a larger cable television company or between cable companies and telephone/Internet service providers. Some of the largest mergers have taken place between cable companies and high technology companies. here are a number of variables that can determine the success of a merger.

Cable television is a major industry in the United States and throughout the world. According…… [Read More]

Mergers and Acquisitions Case Study

One specific phase that the author uses that can be applied to RBS is that innovations may force banks into decisions that are micro-functional, but macro-dysfunctional. In the case of RBS, leadership focus on reductionist metrics that offered increases in efficiencies in certain business functions, however by focusing on micro-functional areas of improvement the organization lost perspective on the macro benefits or losses incurred by a more comprehensive analysis. Furthermore, when examining possible herding behavior by industry executives, if these executives became focused on achieving the same competitive advantage through short-term gains in micro-functional areas and this behavior could potentially spill over and produce a flood of similar behaviors industry wide. Hence, which ever metric became the prefer analysis tool by executives or speculators could influence an entire industry and shift the industry toward inefficiencies.

Governmental Boundaries

The final perspective in which this paper will reflect upon in this particular…… [Read More]

Mergers and Acquisitions the Energy Sector Was

Mergers and Acquisitions

The energy sector was the largest with the most merger and acquisition activity in terms of total value which was disclosed according to PricewaterhouseCoopers (Investopedia, 2011). There were two acquisitions that were particular interesting in this industry. The first was Alpha Natural Resources, Inc. acquisition of Massey Energy for over eight billion dollars. This acquisition is interesting because Massey Energy was the company that owned the Upper Big Branch Mine in est Virginia that experienced an explosion and twenty nine miners were killed. The unfortunate accidents made the operating procedures and lack of safety standards transparent to investors and the stock value plummeted making it a target for Alpha Natural Resources.

Massey Energy was known for a long history of safety violations and other regulatory violations and the FBI actually launch a criminal investigation regarding potential negligence regarding the management of the mine ( Source atch, 2012).…… [Read More]

Mergers and Acquisitions on Health Care the

Mergers and Acquisitions on Health Care

The focus of mergers of health care delivery system is to accentuate the efficiency and profitability of medical practices while dealing with the sweeping changes to the nation's health care delivery system. This paper highlights some of the corporate governance consequences arising from hospital and healthcare system mergers, joint ventures and acquisitions. Health care mergers, together with mergers of hospitals and other health care organizations, are becoming increasingly significant. Many health care organizations believe that they must be large in order to provide effective and extensive care as required by competitive markets. The predominance of managed care systems on the health care industry has matured dramatically as those systems' share of the health care marketplace has grown.

lue Cross and lue Shield of Illinois is one such company. In an effort to achieve economies of scale and further increase market share, the health insurer…… [Read More]

Mergers and Acquisitions Have Had on the

mergers and acquisitions have had on the automobile industry over the years. The author examines the benefits of the Daimler/Chrysler merger and how the strategy provided a positive impact on the resulting company. There was one source used to complete this paper.

Throughout the history of business, mergers and acquisitions have been a fact of life. Whether they were conducted through a mutually agreed upon blending, or taken over with hostile measures a merger or acquisition involves two or more companies coming together and becoming one. ergers provide many positive elements to the final company, but can also presents some difficulties in the way of power struggles, workforce numbers and final production goals.

The automobile industry has depended on mergers for many years to allow the field to accommodate the industry needs. As new designs were needed, market saturations occurred, and financial considerations realized, the use of mergers and acquisitions…… [Read More]

Mergers and Acquisitions The RECS Case

ECS project developed out of the results of the merger of two particular insurance companies, in Quebec and Montreal. The merger occurred as a result of prospective potential for subsequent profitability among the two companies and a significant competitive advantage over the competition. However, the reality of the merger was causing issues for everyone involved. There were problems with customer service, meaning that the team members had to adequately deal with a range of skewed products and distribution networks from the systems at large. Compatibility issues were the norm, particularly with the IT systems in use, which were inherited from a range of merged companies as there wasn't full integration and a host of skewed precuts and networks were derived from the old systems, all without the proper support structures in place to make them work at the highest levels of their abilities. The compatibility issues presented more problems than…… [Read More]

Human Resources Role in Mergers and Acquisitions

Mergers and Acquisitions: Human Resources

HR Role in Mergers & Acquisitions

Mergers and Acquisitions

Human Resources

The purpose of this work is to access the functions and strategies that must be implemented into a successful process of merger and acquisition within the company in relation to the management of human resources [i.e. employees]. Further to do so from the approach of a "value added partnership" in terms of the substantiation of a Return of Investment (ROI)

During the decade of the 1990's over 150 mergers and acquisitions took place with twenty-percent of those M & A's producing substantially lower share holder value, only marginal returns were achieved by thirty-three percent, thirty percent resulted in substantially lowers values for shareholders and a mere seventeen percent created substantial returns for the company's shareholders. Miller {2001}

According to James W. Walker who states that this work is adapted from a Chapter to appear…… [Read More]

Strategies for Success During Mergers and Acquisitions

Mergers and Acquisitions: The Case of Microsoft and EPAM

This paper focuses on Microsoft Corporation. The firm is one of the major public multinational corporations in America with headquarters in edmond, USA. The company majors in developing, manufacturing, licensing, and supporting a broad scope of services and products that are especially predominant in the computing of various product divisions. The firm was established in 1975 with the goal of developing and selling BASIC interpreters to Altair 8800. Microsoft gradually rose to the dominance of operating system markets for home computers using the MS-DOS component from mid-1980s. This was followed by Microsoft Windows dimension of the operating systems. The firm, Microsoft, translated into a dominant office suite market for Microsoft Office. The company has often diversified as seen from recent interactions with the video game industry like the Xbox and the Xbox 360, its successor. The company had made an impact…… [Read More]

Analyzing the Mergers and Acquisitions Senerio

Mergers and Acquisitions

Success criteria for assessment of M&A outcomes

Moini and Wang (2012) define five M&A performance metrics:

Event studies (measures based on stock market): Since the seventies, event studies have been a popular approach, extensively utilized in research on mergers and acquisitions. The approach is created for measuring whether an abnormality exerts an impact on stock price linked to an unforeseen occurrence (M&A), which maintains that returns on stocks indicate swift, impartial, risk-adjusted, and sensible expectations of company value in the imminent period on the basis of appearance of novel facts. Field experts normally outline an event window or period over which event effect will be calculated. They attempt to estimate the failure or success of the acquiring company in capturing value for shareholders via the M&A (Wang & Moini, 2012).

Accounting-based measures: These performance measures also require a long-run outlook of performance of the acquisition (such as…… [Read More]

Leading Mergers and Acquisitions of Hospitals Merging

Leading Mergers and Acquisitions of Hospitals

Merging and Acquisition

When the size of an organization continuously increases in size, management problems arise. Such large organizations operate through bureaucratic structures. The main factors that make bureaucracy work are standardization, co-ordination and specialization. Bureaucratic structure is very efficient in achieving economies of scale and avoiding duplications. The bureaucratic structure works best when there are clear rules of coordination and a clear chain of command (Cameron & Green, 2004).

The history of company mergers and acquisitions dates back to the 1980s. The most common practice for organizations to counter-act aspects of competition was through the adaptation of technology. Nevertheless, recent research has shown that sophisticated technical expertise is not enough to contain competitive advantage. Elusive resources like culture, organizational leadership, and business processes are also crucial. Through mergers and acquisitions, companies are able to manipulate their own influence by adhering to a series…… [Read More]

Mergers and Acquisition Company Acquisition as a

ergers and Acquisition

Company Acquisition

As a CEO, you are trying to acquire a foreign firm. The size of your firm will double and it will become the largest in your industry. What does your firm do and what does the foreign firm you are trying to acquire do? Where are the firms based?

look company is a major company in Ohio Columbus in the U.S. And specializes is the sale of all types of spectacles both for the visually impaired or those with visual problems and sun glasses of all designs. This company has been in operation from 1998 and seeks to expand its operations into the African market by acquiring Yengo enterprises which operates in the major East African cities; that is, Nairobi, Kampala and Kinshasa. As the CEO of I-Look enterprises, I need to take into account the following issues discussed below.

There are many reasons why…… [Read More]

Mergers & Acquisitions Should a Firm Attempt

Mergers & Acquisitions

Should a firm attempt to have fewer or more suppliers?

It depends on the situation the client is in terms of availability of materials and such as well as the number of vendors out there. A firm should balance between not putting all the proverbial eggs in one basket by using only one or two vendors and using too many and thus making administration and logistics more complicated (eSmallOffice, 2013)(Entrepreneur, 2013).

The "sweet spot" is probably 3 or 4 vendors although it can be more if more are required to reliably get all the materials but less may be needed can provide what is needed on time and in a reliable fashion and at a good cost. In short, there shouldn't be more vendors than needed while at the same time, there shouldn't be too few to protect against problems with vendors (eSmallOffice, 2013)(Entrepreneur, 2013)..

What are…… [Read More]

Merger or Acquisition and on

The conclusion whereat these researchers have arrived is that there is a negative mathematical relation between the probability of success of an M&a and the target company's leverage. An increasing leverage shows that equity is slowly substituted with debt, which reduces the fraction of voting right controlled by management and therefore affects the bidder's gain. Stultz finds that the probability of success of a takeover bid is decreasing as the debt-to-equity ratio increases.

Harris and aviv (1988) have studied the same phenomenon from a different point-of-view. They have examined the effects of capital structure change, when it is used and an anti-takeover defense. Substituting debt for equity increases the bargaining power of the target companies. These conclusions were also obtained by way of empirical research (aad and yan (1995), Assem and Titman (1999), and Schwert (2000)): the negative relation between the probability of takeover success and the target's leverage is…… [Read More]

Merger and Acquisition M& a Activity

Vedanta believed that the company overall was undervalued; Hewitt was trying to avoid the loss of a major segment of business.

Overall, merger and acquisition activity has been relatively slow in recent years. However, firms are still trying to find ways to defend their position (GM, Hewitt) and other firms are attempting to creatively extract new value through their transactions (Exxon, a-B/InBev, Vedanta). As long as there are shifting environmental considerations and new opportunities to exploit, firms will continue to seek out merger and acquisition activities.

orks Cited:

McClure, B. (2010). Mergers and acquisitions. Investopedia. Retrieved March 14, 2010 from http://www.investopedia.com/university/mergers/default.asp

Espinoza, J. (2009). Merger pays off for AB InBev. Forbes. Retrieved March 14, 2010 from http://www.forbes.com/2009/03/05/inbev-quarter-profits-markets-equity_drinks.html

Daily, M. & Driver, a. (2009). Exxon Mobil to buy XTO Energy in big U.S. gas bet. Reuters. Retrieved March 14, 2010 from http://www.reuters.com/article/idUSTRE5BD28G20091214

Reuters. (2010). Vedanta eyes aluminum unit spinoff. The Economic…… [Read More]

Value Generation in Cross Border Mergers and Acquisitions

value differences between merging with other companies inside of Western Europe vs. investing in merging with companies in BRC nations. Thus, mergers and acquisitions from within Western Europe were gathered. These were then compared to mergers of Western European companies with BRC nations, including Brazil, Russia, ndia, and China. The data set chosen was to include a span of ten years, from 1999 to 2009. First and foremost, there were more mergers within this time frame than past 2009 based on the fact that the economic crisis in Europe had worsened to a degree that made mergers and acquisitions decline overall in the region. Moreover, after 2009, there were actually increasing trends of BRC nations investing in acquiring Western European nations, and not the other way around because of declining financial conditions that were weakening the acquisition and leveraging power of many European companies. The period of 1999 to 2009…… [Read More]

Global Mergers and Acquisitions the

Conclusion

Standing at the pivotal point of a changing world economy offers companies and business organizations new opportunities, but they must heed the lessons learned thus far, and make wise and pragmatic business decisions. These business choices are responsible for bringing about a stable world economy. Kemal Davis (2005) at the Financial Times and International Finance Corporation, summed it up this way:

"Given the scale of the challenge we face, there has never been a more critical time for the private sector, together with government, society and others to work together to build a better globalization for all (online)."

Building a globally-integrated world is a bold goal, but not unattainable. Business must take the lead and create for itself an environment of consumer trust, product quality and safety, and become more socially diverse and politically smart. Business must demonstrate its integrity, and concern for their markets by creating international trade…… [Read More]

Mergers Acquisitions and Downsizing

Mergers, Acquisitions, And Downsizing

Difference between a merger, acquisition and a downsizing

All the three are management strategies dealing with the competitiveness of the companies in subject (Cassiman, 2006). The choice for either of the three depends on the interest of the subject company in their relationship with the other companies in the industry. The differences arise from the various components such as their concepts, size, application and the condition for their occurrence.

The concepts

Merger is a cooperate strategy involving the combination of many companies whereby the subject companies intend to expand their business operations. Acquisition involves the combination of the companies with only one company having most interest in the newly established company. Downsizing always applies to both the acquisition and merger whereby the newly established company realizes that the new operating structure is costly: consequently triggering the need to downscale the cost (Shook & oth, 2011). Downsizing…… [Read More]

Merger Acquisition and International Strategies Mergers Acquisitions

Merger, Acquisition and International Strategies

Mergers, Acquisitions and International Strategies

A merger is a combination of two or more business entities with the aim of consolidating the resources that they have and creating a single entity with that. The process of merging is done through acquisition or direct pooling together of the resources available. Acquisition occurs when a firm buys a stake in another firm and assumes control of it. Acquisitions are part of growth strategies paid for in cash, payment through stock of the acquiring company or both. Mergers and Acquisitions commonly denoted by M & A work hand in hand and are in recent times seen as one. M & A is a strategy of finance and management dealing with the selling, buying, combination of, firms and entities to help grow a firm rapidly. M & A occur to help a firm create a new strategy, joint venture…… [Read More]

Mergers in 1998 Citicorp Acquired Traveler's Group

Mergers

In 1998, Citicorp acquired Traveler's Group in a merger of financial services giants. The combination created the world's largest financial services company at the time, combining banking, investments and insurance (Martin, 1998). Under terms of the deal, it was a stock swap, with Traveler's paying $70 billion for Citicorp's shares, though the deal was sold as a $140 billion deal (Ibid). The deal paved the way for expectations that future similar deals would be allowed (Carow, 2001). This paper will analyze the deal in retrospect, to see if the deal delivered value for the shareholders of the two firms. Since it was described as a merger, the shareholders of both firms were expected to benefit.

Background

In the late 1990s, there was tremendous excitement in the markets about the possibility that major mergers in the financial services industry would be allowed by Congress. Carow (2001) noted that market expectations…… [Read More]

Acquisition Merger Acquisition International Strategies Merger Acquisition

Acquisition

Merger Acquisition International Strategies

Merger, Acquisition, International Strategies

Merger, Acquisition, International Strategies

For the corporation that has acquired another company, merged with another company, or been acquired by another company, evaluate the strategy that led to the merger or acquisition to determine whether or not this merger or acquisition was a wise choice. Justify your opinion.

Corporation

With around 12,000 employees, Yahoo is a multinational corporation that offers internet-based services. The company offers search engine, web portal, dictionary, email, advertising, groups, answers, video sharing and many more. The company has long series of acquisitions including Social news business Snip-it, blogging site Tumblr, Maktoob etc. one such acquisition was the purchase of Flickr. Flickr is a site for hosting images and videos. Hosting photos was a problem when Flickr was born. Not every site would let upload photos for free. People from anywhere in the world can easy access, make…… [Read More]

Mergers Can Fail for a

If the failure is sufficiently severe, the future of the company could be called into question, leading to customer and supplier flight, creating a death spiral.

These impacts can spread far and wide. For example, a company with a failed merger could ultimately lose market share as its weaknesses and its distracted management are exploited by competitors. Sometimes firms merge to acquire market share, but then fail to perform as well as the two individual entities did, resulting in market share declines. This can cause the firm's industry position to deteriorate in addition to its market share. The loss of prestige can actually impact the market share as well.

Goodwill is created on the balance sheet during a merger as the result of the difference between the cost paid for the acquired company and its book value. The goodwill is reflective of the expected synergies and gains that are expected…… [Read More]

Mergers Managers Rationality

Mergers

The hypothesis is that "if managers are rational, mergers should always lead to an increase in shareholder value." In principle, this statement should hold, but there are a couple of pragmatic considerations that must be taken into account. Before examining the nuts and bolts of mergers, the statement needs to be corrected a little bit -- if managers are rational mergers should always lead to an expected increase in shareholder value. ationality does not imply omniscience, so managers can only make decisions based on what they expect will happen, not with perfect knowledge of the future. In other words, if a merger fails to increase shareholder value, that does not imply that the manager failed to act rationally. Now that we understand that, we can investigate the core principles behind the statement.

Agency Theory

The first underlying concept at work in this statement is agency theory. Agency theory lies…… [Read More]

Merger Analysis in July 2008

The constituent company's presence in China is geographically complementary, so that their respective distribution networks can be used to build each other's brands in their respective strongholds. Further, cost synergies of $1.5 billion annually are expected to accrue (Anheuser-Busch, 2008).

These claims are reasonable. There is little geographical overlap between the different brands. In particular in China, A-B is strong in the northeast, while InBev is strong in the southeast. The two companies are also complementary, with A-B strong in North America and InBev strong in Europe and South America. The experience of InBev in its previous major move in North America (the acquisition of Labatt's in Canada) was that it was able to build market share for InBev global brands by using the existing Canadian distribution system. Therefore, their expectation of replicating this success in the U.S. is reasonable. The claim of cost synergies is, however, questionable. hile InBev…… [Read More]

Merger Financial Analysis of the

The leadership personnel of the companies were far more affected by this merger, and there is no evidence that this merger was viewed as anything but a positive move for both companies by these individuals (Coffee 2006; Taft & Musich 2006; Knorr 2006). The cash premium that was paid to Mercury Interactive shareholders and the ongoing increase in price for Hewlett Packard stock following the merger makes it likely that shareholder response to the merger was equally positive (Google Finance 2010; Hewlett Packard 2006a).

Conclusion

Many mergers, especially in the past decade of increased scrutiny of accounting methods and financial reports, are quite complex and time consuming. The merger between Hewlett Packard and Mercury Interactive, however, was accomplished with a great deal of simplicity and efficiency. Though the primary benefits to both companies were found in the boosted assets, market share, and operational scope of the merged entity, the efficiency…… [Read More]

Acquisition Safeway's Acquisition of Sobeys

The stores are dramatically redesigned with earth-toned decor, subdued lighting, custom flooring, unique display fixtures and other special features to create a warm, inviting ambience that Safeway believes significantly enhances the shopping experience, At year end 2010, 1,439 stores, or 85% of the store base, were Lifestyle stores." (Safeway, p. 12)

This suggests that some Sobeys stores -- likely contingent upon the demographic nature of communities serves -- would be candidates for remodeling according to the 'Lifestyle' design. Additionally, all Sobeys stores would carry Safeway's 2008 initiating branding campaign for its line of organic foods called Better Living Brands, which included O. Organics and Eating Right. (p. 34)

In addition to taking on the brands that currently distinguish the Safeway shopping experience, Sobeys would bring its own line of brand names under the Safeway umbrella. According to its own informational website, Sobeys is the owner of not just Sobeys markets…… [Read More]

Mergers Acquisitions and International Strategies

Mergers, Acquisitions, and International Strategies

A well crafted strategy is crucial for business success in the both the local and the international market. Firms achieve this success by using business-level strategies or corporate-level strategies, or both. Business level strategies (such as cost leadership and differentiation) influence a firm's competitive advantage in its products and markets, while corporate-level strategies (such as mergers and acquisitions) affect the firm as a whole (Hill & Jones, 2012). Firms operating in the global market must also choose effective international business-level strategies and international corporate-level strategies. This paper compares an international company, Samsung, with a history of mergers and/or acquisitions, and a US-based company, Hibbert Sports, Inc., which is based solely in the US and does not have a history of any mergers or acquisitions. The paper specifically evaluates Samsung's acquisition strategy as well as its international business-level strategies and international corporate-level strategies. Also, the paper…… [Read More]

International Strategies Merger and Acquisition

Merger, Acquisition, And International Strategies

Google, Inc.:

From a humble beginning in 1998 of responding to about 10,000 queries by offering search engine services, Google, Inc. has grown to a gigantic multinational corporation providing immense and widely used, actually over 30, services with a search engine capacity that responds to more than 200 million queries daily.

Using a combination of personal logging information and other information gathered from its spectrum of services and Google cookies, it is capable of building large dossiers of pertinent information of its individual users. In this essay I wish to examine Google's three most popular and innovative services namely: Ad Sense, Gmail and Google Search in order to show how the huge amount of data gathered from these three services are used to create incredibly big profiles of all its individual users. I will not, however, underestimate the important role its other services like Google…… [Read More]

Merger Activity Due in Large

Finance-dominated proponents also maintain that boom economic periods generate a more varied divergence of valuations that fuel merger activity (Medlen 2007). In this regard, Medlen concludes that, "Taken collectively, these understandings may explain some of the merger activity in booms, but they involve certain asymmetries that undercut their explanatory power. High stock valuations allow stock to be utilized as currency and collateral for takeovers; yet stock booms also make targets expensive" (p. 202). Moreover, despite the commonly held perception that mergers are a "quick and dirty" way to grow a business and achieve organizational goals, there remains a lack of convincing empirical evidence in support of this perception (Medlen 2007). As Medlen points out, an "anomalous fact about mergers concerns the lack of evidence that mergers are profitable. This fact begs the question: why then are mergers carried out with such frequency and with such large levels of capitalization?" (p.…… [Read More]

Acquisition or Merger

merger usually occurs when both companies are of relatively equal strength. The ideal behind this is that a merger would benefit both companies equally, merging the best elements of both companies in order to form a single company that is stronger than either on its own. The new company can then benefit in a variety of ways. taff reductions for example means job losses, but for the overall revenue of the company, this is a benefit in salary savings. A merged company, being larger in scale than either of the companies before the merge, can also save on goods and equipment purchases. Orders in such cases become larger and can thus be negotiated with the seller. Another benefit is technological advances that become part of the newly merged company. A competitive edge can easily be established by merging the technological elements of both companies, and using the combined brainpower of…… [Read More]

Merger Wave There Are Many Factors That

Merger ave

There are many factors that contribute to today's economic global status. Economic evolution did not happen over night and one can look to history to analyze trends and practices as proof. It is unfair of historians to try to pinpoint one deciding moment in history that influences today's business world. One should see today's market as a reflection of past trends and business practices, a build up of many moments of time full of mistakes and successes. It is fair to say that much of where we are today has much to do with what has been learned already but also what has yet to be learned. It is the notion of possibility that makes the present economy rich and multifaceted. It is the ability to think outside what is already known and break down barriers that makes the future of business very exciting. This type of attitude…… [Read More]

Mergers and Acquisitions

1998, and DuPont is considering spinning off Conoco, an oil and gas company, of which DuPont presently owns 100%. The spinoff would likely be the largest IPO in history if the entire company was sold. There are, however, a number of things that need to be taken into consideration. DuPont may wish to retain some interest in Conoco, perhaps even controlling interest. How much should be spun out is an important consideration. Further, there needs to be an appraisal of the market, to determine what the value of Conoco might be on the open market, and if this is fair value to DuPont for the company. The IPO market needs to be able to handle the Conoco IPO in order to extract the highest price possible for the shares. Further, there needs to be financial considerations, such as how such a deal would affect DuPont's share value. There are also…… [Read More]

Merger Along With Acquisition and International Strategies

Merger, Acquisition, And International Strategies

Ford Corporation: The Volvo takeover

It's imperative for the automotive companies to attain benefits of scale whilst developing latest products which is costing exceedingly high in the present business environment. Compared to the 90's the chances of attaining benefits of scale while saving costs has altered quite a bit. Model volumes have declined which creates difficulties for companies to attain economies of scale, while saving costs. Hence, as a last resort, companies merge with each other, acquire and form alliances with each other to save rising costs while developing new technology and products (Lundback, 2002).

Ford Motor Company

The Ford Motor Company is the second leading profitable automaker in the world. Ford has recently acquired the Swedish-based Volvo for $6.45 billion. Fords profits last year were a bit more than that with $6.57 billion. It's yet another quick acquisition among many others. Ford at present…… [Read More]

Acquisition of Exxon Mobil Technical Report Acquisition

Acquisition of Exxon Mobil

Technical report

Acquisition of Exxon Mobil by EIG

Embry Investment Group is an investment company, which deals in investment, primarily through acquisition of other companies. However, before they acquire an organization, they will require evaluating its overall performance to ensure that their investment will attract many investors in the globe. The suggested company to acquire is Exxon Mobil, a renowned public traded organization, which suits the investor's preference. The suggested company conducts its business in over 200 nations in the globe. In addition, Exxon Mobil has upstream activities in numerous countries. Most importantly, Exxon Mobil deals in gas, oil, coal and chemicals, and its portfolio comprises of discovered oil and gas resources equivalent to 70 billion barrels of oil.

Executive Summary

Currently, business in every sector has become competitive, an aspect, which has seen many companies declining without hope of revival. Therefore, many organizations have put…… [Read More]

Merger One of the Greatest Mergers in

Merger

One of the greatest mergers in the history of computers was recently organized between Hewlett Packard and Compaq Computers. This was a great victory organized by the chief executive of Hewlett Packard, Carleton S. Fiorina. The direct proof has come within one year of the purchase of Compaq computers at a cost of $19 billion. There was a savings of $3.5 billion and this was achieved in one year, when the promise was to save a billion dollars less and that too, by the end of two years. The company has had the classical result of mergers with a decrease of 17,000 jobs but there was a gain of market share, over 3,000 new patents and launching of 367 new products. It was also very successful in gaining new contracts and got $3 billion contract from Proctor and Gamble that is spread out over ten years. The success has…… [Read More]

Acquisition of Assets Financial Terms 2011 -

Acquisition of assets ("Financial Terms," 2011) - which is a merger or consolidation in which an acquirer purchases the selling firm's assets. This is seen in the reading when it discussed about how the different companies are being acquired by other bigger companies, or even in some instances merging. This can be seen quite often in instances akin to the reading to keep a company from going out of business and help it stay in business. All in cost- total cost, explicit and implicit. The reading discusses that in the beginning Guillermo was able to charge a premium for his furniture, because his cost were so low and he did not have to pay much for labor; Asset pricing model ("Financial Terms," 2011) -- a model that determines the required rate of return on a particular asset; Asset- a firm's productive resources. This term deals with the beginning of the…… [Read More]

Moral Hazard in Acquisitions

moral hazard in mergers, acquisitions and takeovers. The essay discusses the definition of moral hazard as well as related agency theory and the role of asymmetrical information in transactions. The essay also reviews insider trading from the perspective of insider trading.

In the context of economic theory, moral hazard describes the tendency of a party to take excessive risks because the costs associated with the unreasonable risk are not incurred by the party taking the risks. That is, when the behavior of one party to a transaction may result in detriment to another party after the transaction has taken place, moral hazard may be said to be present. Moral hazard occurs because an institution or individual does not bear the full responsibility or consequences of its actions, and as a result, there is a tendency to act less carefully than otherwise would be the case; this irresponsible behavior leaves the…… [Read More]

Managing International Acquisitions

Financial Analysis of Mergers and Acquisitions

In the past few years, the amount of mergers and acquisitions have dramatically increased, raising the importance of the strategies and financial analyses performed before the merger or acquisition is expected to occur. Financial, operational, and technical due diligence have become routine undertakings before companies consummate a merger or acquisition. A review of the literature indicates that the strategies employed have a significant impact on whether the merger or acquisition is a success. An example of a very successful strategy that has been implemented several times in the acquisition or merger of companies is the strategy employed by Pfizer. A strategy that did not work out as well is portrayed by Matsushita in its' failed acquisition with MCA. This paper will illustrate and analyze the strategies employed in such transactions in addition to the financial outcomes of the deals.

Pfizer's overall business philosophy has…… [Read More]

Ralcorp Holdings Inc 's Proposed an Acquisition of

alcorp Holdings, Inc.'s proposed an acquisition of Sara Lee Corp on its stock price. This paper is done with a buy decision for alcorp Holdings stock in mind. The sell recommendation in relation to the content of the news article titled "alcorp Holdings to Purchase Sara Lee's Private Brand efrigerated Dough Business." This is done with the necessary theories of mergers and acquisition in mind as well as with relevant calculations and support documentation. The goal is to determine what the content of the news article means for the investment merits of the stock by evaluating how the event covered in the article have a positive, negative or neutral effect on the stock price. This paper also explains how this affects my investment recommendation.

Introduction

Some time back, alcorp Holdings, Inc. indicated that it had acquired the Sara Lee Corp., a North American private brand refrigerated dough business at close…… [Read More]

Fox Acquisition of Sky

21st Century Fox's Takeover Of Sky

21st Century Fox has been planning to acquire or takeover of Sky, which has dominated news reports in the recent past. While the plan for the deal has been ongoing for sometime, it has faced several challenges that have caused delays. The delays in the conclusion of the deal have particularly been centered on sexual and racial harassment allegations surrounding Fox News. The acquisition of Sky by 21st Century Fox has looked more vulnerable in the aftermath of the General Election because of investigations into these allegations by Ofcom (Turvill, 2017). Ofcom has been investigating whether 21st Century Fox would be deemed as a fit and proper owner test in light of the claims of racial and sexual harassment. The investigations would also look into whether the takeover would hurt the media plurality in the United Kingdom, which is considered as an important component…… [Read More]

Cisco Began Its Acquisition Spree in 1993

Cisco began its acquisition spree in 1993 with the purchase of Crescendo Communications Inc. (Cisco, 1993). The purpose of this acquisition was to acquire a product that Cisco's customers wanted, but that Cisco did not at the time provide. Over the rest of the 1990s, Cisco focused on that type of expansion, totaling 71 acquisitions and a massive growth in the size of the company both in terms of revenue and employees (Ibid).

The company was driven to make these acquisitions because it wanted to serve its major customers better. Cisco was selling to firms like Ford and Boeing, and it was under pressure to add new products to its lineup in order to meet their needs. Acquiring companies that already had those products was seen by Cisco management as the quickest way to meet this market need to hold competitors at bay. The initial acquisitions were made in this…… [Read More]

Cquay Technologies Corp Mergers and

Thus, the company did not manage to the fullest extent to capitalize on achieved competitive advantages and did not manage to cover all the risks

Before the merger, the HP managers expected their market growth rate between the years of 2002 to 2004 to annual increase by 12%, for the PCs business segment to grow by 8% annually, for services segment by 12% and to increase imaging and printing segment by 10% annually. The company projected the highest profit margin growth in the servicing sector as this was Compaq competitive advantage before the merger. After 3 years of the merger, the actual earned revenues were not equal to the predicted ones in any sector: the enterprise revenues fell by 20% in 2002 compared with their 2001 rates, and by 5% from 2003 to 2002; the same happened with PCs segment, while services segment also decreased considerably by 11% in revenues…… [Read More]

Aquisition Proposal Acquisition Analysis Financial

Fastpack has an impressive, solid position on the uritanian courier market. The company does not necessarily need to be acquired by TNT. In my opinion, Fastpack would have more to gain if it were not acquired by TNT. Fastpack has a market share base on the international market that the company can further exploit and expand, leading to overall growth for the company, both locally and internationally.

TNT however, needs to acquire Fastpack. As mentioned above, it is quite difficult for foreign companies to enter the uritanian courier market. The best way of succeeding would be to acquire a well-known local company. Therefore, it might be a better solution for both companies, and especially for Fastpack, to decide upon a merger between the two companies rather than on an acquisition of Fastpack by TNT.

Initial Valuation of the Company Acquired by TNT

Objective: the purpose of the acquisition of Fastpack…… [Read More]

Sprint Nextel Merger History of

The transaction was all-cash and was estimated at approximately $4.3 billion, including the assumption of approximately $900 million of net debt. Before acquiring Alamosa, Sprint Nextel Corporation was involved in some litigation issue with one of Alamosa Holdings' subsidiaries, AirGate PCS Inc. Therefore, completing the Alamosa acquisition brought final resolution in this matter. Alamosa was one of Sprint's most important affiliates before the merger with Nextel and the acquisition of this wireless affiliate. Texas based Alamosa Holdings provides Sprint PCS services in 19 states across the United States, and it has about 1.5 million direct wireless subscribers. The affiliate has approximately 1,300 employees. In 2005, Alamosa Holdings' revenues reached $1.32 billion. The most important outcome of acquiring Alamosa Holdings was the fact that the acquisition extended Sprint Nextel Corporation's direct service territory to an additional 20 million people in 19 states.

Another wireless affiliate that was acquired by Sprint Nextel…… [Read More]

Failure of Mergers

Failures of Merger

Failure of Mergers

The objective of this study is to examine why it is that most mergers fail and will provide real-life examples of the failure of mergers. Toward this end, this work will examine relevant literature in this area of study and specifically academic and professional literature and publications that are peer-reviewed in nature. The work of Weber and Camerer (2003 ) entitled "Cultural Conflict and Merger Failure: An Experimental Approach" reports that most mergers fail and that failure occur "on average in every sense: acquiring firm stock prices tend to slightly fail when mergers are announced; many acquired companies are later sold off; and profitability of the acquired firm is lower after the merger." (Weber and Camerer, 2003) There is a great deal of conflict reported during the process of a merger that results in a high rate of turnover." Disappointment was expressed by participants…… [Read More]

Intrastrate Acquisition of People's Natural

" (Schlossberg, 2004)

FERC analyzed while making a review of the electric utility mergers proposition, the transaction being proposed "likely effect" on (1) competition;

(2) rates; and (3) regulation. (Schlossberg, 2004)

There are stated to be "no antitrust exemptions for transactions subject to FERC review and such mergers are regularly reviewed by either the Federal Trade Commission (FTC) or the Division." (Schlossberg, 2004) The Securities and Exchange Commission had previously held jurisdiction for reviewing acquisitions of stock of electric utility companies however, the authority provided under the Public Utilities Holding Company Act of 1935 was repealed in 2005.

III. FORESEEAILITY DOCTRINE REHAILITATION

The work of Trujillo (2006) entitled: "State Action Antitrust Exemption Collides with Deregulation: Rehabilitating the Foreeseability Doctrine" states that a capitalist society that has policies which were established for the purpose of regulating "the promotion of competition in traditionally regulated industries such as the electrical market seems counterintuitive.…… [Read More]

Effects of Company Mergers on Employees

Company Mergers on Employees

The end of the twentieth century saw a wave of domestic and cross-border corporate mergers and acquisitions. Worldwide M&As grew at an average of 42% per annum between 1980 and 1999, reaching U.S.$2.3 trillion in 1999, according to the United Nations World Investment eport 2000. The report also suggested that the merger trend was evidence of an emerging globalized market (Cheng). While the globalization of markets is one important driving factor behind cross-border mergers since this allows for easier access to new markets through acquisition of strong local players, there are several other reasons why companies may choose to merge. Objectives range from the need to reduce competition, lower cost of production, eliminate excess capacity, increase market share through the acquisition of strong, established brands to the desire to acquire new technology and realize economies of scale in production, distribution, and purchase. Further, weak financial positions…… [Read More]

Rail Acquisition Why Does Csx Want to

Rail Acquisition

Why does CSX want to buy Conrail? How much should CSX be willing to pay for it?

CSX wants to buy Conrail to acquire a larger portion of the Northeastern available rail lines as well as to increase its efficiency. CSX should be willing to pay slightly above the blended value, so about $90 per share.

Why did CSX make a two-tiered offer? What effect does this structure have on the transaction?

Two-tiered offers are common in such situations. They comprise of a first step in which an offer is made to purchase enough of the stockholders' shares. The second phase is the offering of other shares at a lower price. This strategy has the advantages of reducing both cheaper and less risky (in terms of losing out on the purchase).

As a shareholder in Conrail, would you tender your share to CSX at $92.50 in the first…… [Read More]

Mobile Sprint Merger Within the More

Mobile / Sprint Merger

Within the more and more dynamic and challenging economic, social and technological context, the economic agents devise a wide array of coping mechanisms. One common means in which they strive to consolidate their competitive positions is through mergers and acquisitions. These imply the unification of two traditional competitors in a means in which mutual benefits are created, such as wider access to the market, know how, expertise, resources and so on.

Today, a piece of news which torments the American business community is related to the potential merger between mobile telephone monoliths T-Mobile and Sprint. It is the opinion of this study that the merger would be of a positive impact for the two firms. The following lines reveal the rationale for this conclusion.

The financial state of the companies

Data is not available for the entire 2010 fiscal year, but the information which is available…… [Read More]