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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…
Reference
Carol, U.K. (2002).Merck-Medco to become stand-alone PBM. Drug Topics.4:12.
Investopedia, (2010).The Basics of Mergers and Acquisitions. Investopedia Inc.
Main, A. Wiss, S. Motoba, A. et al. (2012). Merck & Co., Inc. (NYSE: MRK). Krause Fund Research.
Merck (2011). Merck Annual Report. Merck & Co.
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…
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…
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…
References
Anand, M. (2008). Cover Story Tata Jaguar Land Rover. Outlook Publishing. Available online on URL http://books.google.co.uk/books?id=kjEEAAAAMBAJ&pg=PT27&dq=tata+motors+jaguar+land+rover&cd=1#v=onepage&q=tata%20motors%20jaguar%20land%20rover&f=false
Duane I.R., Robert E. Hoskisson, Michael A. Hitt (2007) "Understanding Business Strategy: Concept and Cases" Cengage learning, Available on URL: http://books.google.co.uk/books?id=jX7RXTi8MTEC&pg=PT151&dq=tata+motors+jaguar+land+rover&cd=2#v=onepage&q=tata%20motors%20jaguar%20land%20rover&f=false
Kumar, G and Pradeep, J. (2009), "TATA," Business journal
Mortimer, J. (2009). Jaguar lifts XF robot total to 179. Industrial Robot: An International Journal, ISSN 0143-991X, Volume 36, Issue 2, pp. 114-120
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…
References
Aharon, D.Y. Gavious, I. & Yosef, F. (2010). Stock Market Bubble Effects on Mergers and Acquisitions. The Quarterly Review of Economics and Finance.
Brown, T.C. Werling, K.A. Walker, B.C. et al. (2012). Current Trends in Hospital Mergers and Acquisitions. Healthcare Financial Management. 66 (3) 114-120.
Carter, R. (2011). Taking the Pulse. KPMG International. Switzerland.
Gaynor, M. & Mark, T (1999). Physician Contracting with Health Plans: A Survey of the Literature. Carnegie Mellon University.
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,…
References
Benos, E., Weisbach, M., 2004. Private bene-ts and cross-listings in the United States. Emerging Markets Review 5 (2), 217 -- 240. Taken from: Martynova, M. And Renneboog, L. (2008). Spillover of corporate governance standards in cross-border mergers and acquisitions. Journal of Corporate Finance 14, 200 -- 223
Blume, M., 1979. Betas and their regression tendencies: some further evidence. Journal of Finance 34, 265 -- 267. Taken from: Martynova, M. And Renneboog, L. (2008). Spillover of corporate governance standards in cross-border mergers and acquisitions. Journal of Corporate Finance 14, 200 -- 223
Bris, a., Cabolis, C., 2008. The value of investor protection: rm evidence from cross-border mergers. Review of Financial Studies 21 (2), 605 -- 648. Taken from: Martynova, M. And Renneboog, L. (2008). Spillover of corporate governance standards in cross-border mergers and acquisitions. Journal of Corporate Finance 14, 200 -- 223
Doidge, C., Karolyi, a., Stulz, R., 2007. Why do countries matter so much for corporate governance? Journal of Financial Economics 86 (1), 1 -- 39. Taken from: Martynova, M. And Renneboog, L. (2008). Spillover of corporate governance standards in cross-border mergers and acquisitions. Journal of Corporate Finance 14, 200 -- 223
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…
References
Coller, S. (1993). Mergers and acquisitions: Special dangers and opportunities.
Management Quarterly, 34(4): 4.
Daniel, T.A. & Metcalf, G.S. (2001). The management of people in mergers and acquisitions. Westport: Quorum Books.
Galpin, T.J. & Herndon, M. (2000). The complete guide to mergers & acquisitions:
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…
Works Cited
Mergers and Acquisitions: Definition." 2006). Investopedia. Retrieved 5 Dec 2006 at http://www.investopedia.com/university/mergers/mergers1.asp
Mergers and Acquisitions: Valuation Maters." (2006). Investopedia. Retrieved 5 Dec 2006 at http://www.investopedia.com/university/mergers/mergers2.asp
Mergers and Acquisitions: Why They Can Fail." (2006). Investopedia. Retrieved 5 Dec 2006 at http://www.investopedia.com/university/mergers/mergers5.asp
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…
REFERENCES
Angrisani, D., & Goldman, R. (1997). Predicting Successful Mergers and Acquisitions. Binghamton, NY: Haworth Press.
Bruner, R.F. (2004). Applied Mergers and Acquisitions. New York: John Wiley.
Carr, P. (2006). Implementing Culture Change. Alexandria, VA: Oakmount Press.
Farb, D. (2004). Reorganizing for Customer and Patient Care. Los Angeles: University Press.
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…
Bibliography
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 $57B, CNN Money, January 28, 2005, http://money.cnn.com , last accessed on February 28, 2007
Procter&Gamble buys Gillette to Form the World's Biggest Consumer Products Group, FinFacts Ireland, Business&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
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…
References
Ginsburg, C. (1996, November 18). The Patient as Profit Center: Hospital Inc. Comes to Town. The Nation, 263, 18+. Retrieved January 18, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=5002274395
Levins, R. (2000, September). Is Capitalism a Disease? The Crisis in U.S. Public Health. Monthly Review, 52, 8. Retrieved January 18, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=5002365863
Singer, P.A. (2002, May). Rx for Reform. Foreign Policy 76+. Retrieved January 18, 2007, from Questia database: http://www.questia.com/PM.qst?a=o&d=5000749779
Mergers and Acquisitions
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…
References
Kinne, Konstanze. (June, 1999) "Efficiencies in Merger Analysis" Inter-Economics. Retrieved from http://www.hwwa.de/Publikationen/Intereconomics/1999/ie_docs1999/ie9906-kinne.htm. Accessed 10 September, 2005
Sprint, Nextel Complete $35 Billion Merger" (13 August, 2005) Retrieved at http://biz.yahoo.com/ap/050813/sprint_nextel.html?.v=2Accessed 10 September, 2005
Sprint Nextel Completes Merger" (12 August, 2005) Retrieved at http://biz.yahoo.com/bw/050812/125434.html?.v=1Accessed 10 September, 2005
Sun Microsystems completes StorageTek purchase" (31 August, 2005) Retrieved at http://yahoo.reuters.com/financeQuoteCompanyNewsArticle.jhtml?duid=mtfh22393_2005-08-31_22-31-51_n31396739_newsmlAccessed 10 September, 2005
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…
There are approximately 30 to 60 channels that most cable stations can offer consumers. In recent years there has been a substantial increase in the number of television stations available. For instance, there are systems that offer more than 100 channels. The majority of subscribers to cable television have over 54 channels from which to choose. The channel capacity of a cable system encourages providers to offer customers many different services. Not only do cable companies offer over-the-air television broadcast signals, they also offer customers a variety of programming. This programming includes special entertainment features, business information, news, weather, movies, sports, and programming designed for certain groups such as women, children, and ethnic and racial groups (FCC, 2000).
Many cable companies also develop their own local programming and provide access channels so that institutions and public agencies. Cable companies can also offer access channels for rent during specific time slots. "Electronic banking, shopping, utility meter reading, and home security are some of the home services that are possible using the two-way transmission capabilities of cable television systems" (FCC, 2000).
In recent years the manner in which cable television is delivered has changed rapidly because of changes in technology and the manner in which information is delivered. There was a time when the delivery of television beyond local stations was in the hands of a few. However over the last decade the increased popularity of satellite television has presented the cable industry with a great deal of competition. Competition is also present as it pertains to the manner in which people get information such as the news. In today's tech savvy environment consumers often turn to the
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…
Works Cited
Bower, Joseph L. 2001. "Not All M&as Are Alike -- and That Matters." Harvard
Business Review 79, no. 3: 92-101. Business Source Premier, EBSCOhost
(accessed May 20, 2010).
Croft, Jane, and Andrew Bolger. 2009. 'Painful' ABN deal spelled doom. FT.com, April 3, http://www.proquest.com (accessed May 20, 2010).
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).…
Works Cited
Source Watch. (2012). Upper Big Branch Mine Disaster. Retrieved from Source Watch: http://www.sourcewatch.org/index.php/Upper_Big_Branch_Mine_Disaster
Investopedia. (2011, December 30). 2011's Biggest Mergers and Acquisitions. Retrieved from Investopedia: http://www.investopedia.com/stock-analysis/2011/2011s-biggest-mergers-and-acquisitions-esrx-bhp-duk-txn-t-jnj-msft-wag1218.aspx#axzz2A4lUoQsa
Micorsoft. (2011, October 13). Microsoft Officially Welcomes Skype. Retrieved from News Center: http://www.microsoft.com/en-us/news/press/2011/oct11/10-13skypepr.aspx
Wollman, D. (2012, October 22). Microsoft announces Skype for Windows 8: full-screen calls, push notifications and People Hub integration. Retrieved from Engadget: http://www.engadget.com/2012/10/22/skype-for-windows-8/
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…
Bibliography
Clement, J.P., McCue, M.J., Luke, R.D., and others,"Strategic hospital alliances: Impact on financial performance," pp. 193-203.
Feature Story
http://www.ahcpr.gov/research/jan98/ra1.htm
Make It Your Business
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…
Mergers and acquisitions in the automobile industry has been happening for many years. The ability to have financial strength in the development and design areas, stronger workforces and combined management teams are among the reasons that the mergers occur in this industry and remain strong today. The Daimler/Chrysler merger created a stronger company for both manufacturers. It allowed Chrysler to survive the problems it was encountering and it provided the funds and team members to study the industry and make solid plans for the future.
REFERENCE
Grainer, Robert M. DaimlerChrysler merger case study. 2002.
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…
References
Atkearney.com. (2013). Countdown to 2015: Creating ASEAN Champions. Retrieved from atkearney.com: http://www.atkearney.com/mergers-acquisitions/featured-article/-/asset_publisher/BqWAk3NLsZIU/content/countdown-to-2015-creating-asean-champions/10192?_101_INSTANCE_BqWAk3NLsZIU_redirect=%2Fmergers-acquisitions
Figuerido, R. (2012, December). Communicating with Employees during Mergers and Acquisitions: How is the Use of the Authentic Communication Principles Associated with Employee Outcomes? . Retrieved from northwestern.edu: http://www.sesp.northwestern.edu/masters-learning-and-organizational-change/knowledge-lens/stories/2013/communicating-with-employees-during-mergers-and-acquisitions.html
Group, M.C. (2013). Good communication is essential for successful mergers and acquisitions. Retrieved from cuttingedgepr.com: http://www.cuttingedgepr.com/articles/changecomm_good_comm.asp
Hall, K. (2012). Successful Strategies. Retrieved from kaufmanhall.com: https://www.kaufmanhall.com/SitePages/MA_Services_BuySide.aspx
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…
Bibliography:
Anderson, Julie Kathryn (1999) People Management: The Crucial Aspect of Mergers and Acquisitions" Industrial Relations Centre Publication [Online] available at the Queen's University website http://qsilver.queens, u.ca/irl/qsirc/.
Branson, Ruth (2000) HR's Role in Mergers and Acquisitions -- Human Resource Management [Online] available at: http://www.looksmart.com/training& ; development
Clemente, Mark N. et al. (1998) Winning at Mergers and Acquisitions (1998) John Wiley and Sons.
.Frost, Mike (2001) The M & A Transition Guide HR Magazine Vol.46 No.10 ISSN: 10473149 2001 Oct 1 [Online] retrieved from Highbeam Research Engine Account
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…
References
DePamphilis, D. (2010). Mergers and Acquisitions Basics: All You Need To Know. New York: Academic Press.
Gleich, R., Kierans, G., Hasselbach, T. (2010). Value in Due Diligence: Contemporary Strategies for Merger and Acquisition Success. New York: Gower Publishing, Ltd.
Hoffmann, N.W. (2012). Mergers and Acquisitions Strategy for Consolidations: Roll Up, Roll Out and Innovate for Superior Growth and Returns. New York: McGraw Hill Professional.
Sherman, A.J. (2011). Mergers and Acquisitions from A to Z. New York: AMACOM Div American Mgmt Assn.
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…
References
Hayward, M. (2002). When do firms learn from their acquisition experience. Strategic Management Journal, 23(1), 21-39.
Market Watch. (2013). Maxim Integrated Completes Acquisition of Volterra Semiconductor Corporation. Retrieved October 20, 2015, from http://www.marketwatch.com/story/maxim-integrated-completes-acquisition-of-volterra-semiconductor-corporation-2013-10-01
Nasdaq.com. (2013). Maxim to Take Over Volterra - Analyst Blog. Retrieved October 20, 2015, from http://www.nasdaq.com/article/maxim-to-take-over-volterra-analyst-blog-cm268552
Ravenscraft, D., & Scherer, F. (1987). Mergers, Sell-offs, and Economic Efficiency. Washington DC: Brookings Institution.
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…
References
Cameron, E., & Green, M. (2004). Making sense of change management: a complete guide to the models, tools and techniques of organizational change. London: Cogan Page.
DePamphilis, D. (2011). Mergers, Acquisitions, and Other Restructuring Activities: an Integrated Approach to Process, Tools, Cases, and Solutions. Elsevier Science:
Burlington.
Habilozek, E., & Kovacich, G. (2005). Elsever Butterworth Heinemann,. Amsterdam: Elsever
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…
Reference:
Angwin, D. (2001), "Mergers and acquisitions across European borders: national perspectives on pre-acquisition due diligence and the use of professional advisers," Journal of World Business, Vol. 36 No. 1, pp. 2-57.
Assem, S., and S. Titman, "Leverage and Corporate Performance: Evidence from Unsuccessful Takeovers," Journal of Finance, 54 (1999), pp. 547-580.
Branch, B., Yang, T."Predicting Successful Takeovers and Risk Arbitrage" Quarterly Journal of Business and Economics. Lincoln: Winter 2003.Vol.42, Iss. 1/2; pg. 3, ProQuest
Buono, a.F. And Bowditch, J.L. (1989), the Human Side of Mergers and Acquisitions, Jossey-Bass, San Francisco, CA.
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…
Works 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 Times. Retrieved March 14, 2010 from http://economictimes.indiatimes.com/news/international-business/Vedanta-eyes-aluminium-unit-spin-off-Report/articleshow/5683287.cms
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…
Institute of Mergers, Acquisitions, and Alliances. (2015). Statistics. Mergers and Acquisitions. Web. http://www.imaa-institute.org/statistics-mergers-acquisitions.html
Thomson Reuters. (2013). Mergers & Acquisitions Review: Financial Advisors. Web. http://www.pwc.es/es/servicios/transacciones/assets/thomson-reuters-mergers-and-acquisitions-review-2013.pdf
Wang, D. & Moini, H. (2012). Performance assessment of mergers and acquisitions: Evidence from Denmark. E-Leader Berlin. Web. http://www.g-casa.com/conferences/berlin/papers/Wang.pdf
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…
Works Cited
Davis, Kemal, (2005). Newsroom, United Nations Development Programme, found online at http://content.undp.org/go/newsroom/2005/november/statement-dervis corporation-conference-20051109.en?src=print, retrieved February 2, 2010.
Elliott, Peter and Devine, Tim, (2009). Technology and Digital Business, FT.Com,
Financial Times, found online at
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…
References
Agrawal, A. & Jaffe, J. (1999). The post-merger performance puzzle. Advances in Mergers and Acquisitions. JAI Press, Stamford, CT.
Agrawal, A., Jaffe, J. & Mandelker, G. (1992). The post-merger performance of acquiring firms: A re-examination of an anomaly. The Journal of Finance. Vol. XLVIII (4) 1605-1621.
Arthur, W. (1994). Inductive reasoning and bounded rationality. The American Economic Review. Vol. 84 (2) 406-411.
Eisenhardt, K. (1989). Agency theory: An assessment and review. The Academy of Management Review. Vol. 14 (1) 57-74.
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…
References
Frainshmidt, S., Smith, A., & Judge, W. (2016). National competitiveness and Porter's diamond model: the role of MNE penetration and governance quality. Global Strategy Journal, 6(2), 81-104.
Hibbett Sports Inc. (2017). Investor relations. Retrieved from http://phx.corporate- ir.net/phoenix.zhtml?c=78137&p=irol-irhome
Hill, C., & Jones, G. (2012). Essentials of strategic management. 3rd edition. Boston: Cengage Learning.
Johnson, G., Scholes, K., & Whittington, R. (2010). Exploring corporate strategy. London: Prentice Hall.
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…
Bibliography
Bhatia, A., Deep, G., & Sachdeva, A. (2012). Strategic analysis of search engine giant: A case study of googleinc. International Journal of Computing and Business Research. Retrieved from http://www.researchmanuscripts.com/isociety2012/55.pdf
Delichatsios, S.A., & Sonuyi, T. (2005). Get to know Google, because they know you. Retrieved from http://groups.csail.mit.edu/mac/classes/6.805/student-papers/fall05-papers/google.pdf
Dess, L.E.(2012). Corporate level strategy. Retrieved from International Strategic Management: http://brianhenderschiedtbsad428.blogspot.ca/2012/03/walmart-corporate-level-strategy.html
Digication.(2014). Google's corporate level strategy. Retrieved from https://stonybrook.digication.com/calvins_google/Corporate_level_strategy
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.…
References
Ahern, K.A. & Weston, J.F. (2007). 'M&as: the Good, the Bad, and the Ugly.' Journal
of Applied Finance, vol. 17, no. 1, pp. 5-7.
Babbie, E. (1990). Survey Research Methods (2nd ed.). Belmont, CA: Wadsworth
Publishing Company.
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…
Work Cited
O'Brien, Patrick Anthony. "Factory Size, Economies of Scale, and the Great Merger Wave of
1898-1902." The Journal of Economic History Vol. 48, No. 3 (1988): 639-649.
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…
Works Cited:
Chang, J. (1998). DuPont begins to sell Conoco in effort to focus on biotech. ICIS.com. Retrieved October 4, 2013 from http://www.icis.com/Articles/1998/05/18/87415/dupont-begins-to-sell-conoco-in-effort-to-focus-on-biotech.html
ConocoPhillips. (2013) Who we are. Conoco Phillips. Retrieved October 3, 2013 from http://www.conocophillips.com/EN/about/who_we_are/history/conoco/Pages/
Moore, H. (1998). Record-setting Conoco IPO raises $4.4 billion. The Street.com. Retrieved October 4, 2013 from http://www.thestreet.com/story/21347/1/record-setting-conoco-ipo-raises-44-billion.html
WTRG.org. (2013). OPEC events and oil prices (graph). Wtrg.org. Retrieve October 3, 2013 from http://www.wtrg.com/prices.htm
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…
Bibliography
AECOM. (2014, July 13). Retrieved October 13, 2014, from http://www.aecom.com/News/Press+Releases/_carousel/AECOM+to+acquire+URS+Corporation+for+U.S.$56.31+per+share+in+cash+and+stock
AECOM Capital. (n.d.). Retrieved October 13, 2014, from http://www.aecom.com/About/AECOM+Capital
Asongu, J. (2007). Innovation as an Argument for Corporate Social Responsibility. Journal of Business and Public Policy.
Fairholm, M. (2009). Leadership and Organizational Strategy. The Innovation Journal: The Public Sector Innovation Journal, 2-15.
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…
Works Cited
Carlton, Dennis W. And Daniel R. Fischel. "The Regulation of Insider Trading." Stanford Law Review. (1983) 35: 857 -- 895. Web. .
Heakal, Reem. "Defining Illegal Insider Trading." (September 25, 2010) n. pag. Web. .
Kleiman, Robert T. "Agency Theory." (2012): n. pag. Web. .
Stein, Jeremy C. "Takeover Threats and Managerial Myopia." Journal of Political Economy. (1988) 96.1: 61- 80. Web. .
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…
Bibliography
Mcgarvey, R. (1997). Due Diligence. Entrepreneur Magazine, October.
Recklies, O. (2003). Vision as Key Factor in Merger Processes. Retrieved July 28, 2005 from http://www.themanager.org .
Tsao, Amy. (2004). Pfizer's Show of Strength. Business Week, December.
Wood, Mackenzie. (2004). Pharmaceutical Overview. Executives Guide, 15-18.
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…
References
Andrade, G. Mitchell, M. And Stafford, E. (2001) 'New evidence and perspectives on acquisitions'.Journal of Economic Perspectives, vol. 15, pp. 103-120
Comtex News Network (2012). Shares of RAH Down 15.1% Since Downtrend Call on Shares.
http://funds.usatoday.com/news/story.idms-ID_NEWS=30346688&ID_SUPPLIER_CATEGORY=18614,18686,45864,18689
Feltham, G, and Ohlson, J.A. (1995) 'Valuation and Clean Surplus Accounting for Operating and Financial Activities', Contemporary Accounting Research, vol. 11, pp. 689-731.
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…
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…
Works Cited:
Cartwright, S. & Cooper, C. (1993). The role of culture compatibility in successful organizational marriage. Academy of Management Executive. Vol. 7 (2) 57-70.
Cisco (1993). Cisco Systems Corporate Timeline. Cisco Systems press release. Retrieved December 14, 2008 from http://newsroom.cisco.com/dlls/timeline/1993_index.shtml
Singh, H. & Chaudhuri, S. (2008). Cisco's acquisition strategy (1993 to 2000): Value growth through buying early-stage companies. Wharton School, University of Pennsylvania. In possession of the author.
Weber, Y., Shenkar, O. & Raveh, A. (1996). National and corporate cultural fit in mergers/acquisitions: An exploratory study. Management Science. Vol. 42 (8) 1215-1227.
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…
Nguyen, H., Kleiner, B. The Effective Management of Mergers, Leadership & Organization Development Journal, Volume 24 (8), 2003, pp. 447-454.
Jackson, J. HP-Compaq Merger Could Aid Resellers, available at http://www.washingtontechnology.com/news/16_13/business/17177-1.html
CQUAY Technologies Corp
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…
Reference List
Summary Balance Sheets (2008). Retrieved January 22, 2009.
Executive Summary (2008). Retrieved January 23, 2009.
Platt, Gordon (2004). Cross-Border Mergers Show Rising Trend as Global Economy Expands. Global Finance. Retrieved January 23, 2009 at http://findarticles.com/p/articles/mi_qa3715/is_200412/ai_n9466795 .
Finkelstein, Sydney (2008). Cross Border Mergers and Acquisitions. Dartmouth College. Retrieved January 23, 2009 at http://mba.tuck.dartmouth.edu/pages/faculty/syd.finkelstein/articles/Cross_Border.pdf .
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…
Reference List
The Sprint Tradition (2007). Sprint Nextel. Retrieved June 12, 2007 at http://www.sprint.com/companyinfo/history/ .
Sprint Corporation 1899-2005 (2007). Wikipedia, the free encyclopedia. Retrieved June 12, 2007 at http://en.wikipedia.org/wiki/Sprint_Corporation_%%29 .
Nextel Communications (2007). Wikipedia, the free encyclopedia. Retrieved June 12, 2007 at http://en.wikipedia.org/wiki/NEXTEL_Communications_%%29 .
Sprint Nextel (2007). Wikipedia, the free encyclopedia. Retrieved June 13, 2007 at http://en.wikipedia.org/wiki/Sprint_Nextel#Merger_of_Sprint_and_NEXTEL .
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…
References
Chiriac, Irina Sandu case (2011) Mergers -- Success or Failure? CES Working Papers, III [1] 2001. Retrieved from: http://www.cse.uaic.ro/WorkingPapers/articles/CESWP2011_III1_SAN.pdf
Cross-Border Mergers & Acquisitions: Reducing the Risk of Failure (nd) Communicaid,. Retrieved from: http://www.communicaid.com/access/pdf/library/culture/Cross-Border%20Mergers%20&%20Acquisitions_Reducing%20the%20Risk%20of%20Failure.pdf
Dumon, Marv (2008) Biggest Merger and Acquisition Disasters. Investopedia. Retrieved from: http://www.investopedia.com/articles/financial-theory/08/merger-acquisition-disasters.asp
Elwin, Toby (2010) Mergers and Acquisitions Failures are Project Management Failures. 30 November, 2010. Retrieved from: http://www.amajorc.com/blog/mergers-and-acquisitions-failures-are-project-management-failures
" (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.…
BIBLIOGRAPHY
Ewing, Saul (2007) FTC Complaint May Seek to Erode 'State Action' Immunity of Utilities. Staying Ahead Bulletin April 2007. Utility Law. Online available at: http://www.saul.com/common/publications/pdf_1285.pdf
Schlossberg, Robert S. (2004) Mergers and Acquisitions: Understanding the Antitrust Issues. American Bar Association 2004. Google, Books Online available at: http://books.google.com/books?id=JmcoRxfB1OsC
Trujillo, Elizabeth (2006) State Action Antitrust Exemption Collides with Deregulation: Rehabilitating the foreseeability Doctrine. Fordham Journal of Corporate & Financial Law. Online available at: http://findarticles.com/p/articles/mi_qa4048/is_200601/ai_n16410098/
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…
References
Cheng, E. What's driving the wave of corporate mergers. Green Left Online Edition.
Retrieved from the World Wide Web: http://www.greenleft.org.au/back/2001/438/438p16.htm
Gharib, S. (Feb. 24, 2004). Commentary: The Merger Mania Failure Factor. Quote.com.
Retrieved Mar. 2, 2004 from the World Wide Web: http://finance.lycos.com/qc/news/story.aspx?story=200402250300_NBR_NBR-20040224-STORY4&symbols=NBR:100
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…
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…
References:
2010, Sprint Nextel (NYSE:S) and T-Mobile merger rumors return after comments from Sprint CEO, American Banking & Marketing News, http://www.americanbankingnews.com/2010/07/15/sprint-nextel-nyse-s-and-t-mobile-merger-rumors-return-after-comments-from-sprint-ceo / last accessed on February 24, 2011
2011, Sprint Nextel Corp, Bloomberg Businessweek, http://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=S:U.S . last accessed on February 24, 2011
2011, T-Mobile USA reports third quarter 2010 results, T-Mobile website, http://www.t-mobile.com/Cms/Files/Published/0000BDF20016F5DD010312E2BDE4AE9B/5657114502E70FF3012B59F6EC3E60E2/file/TMUSQ32010PressReleaseFinal%5B1%5D.pdf last accessed on February 24, 2011
2011, T-Mobile closing its doors in 2011? Not so fast! Tmo News, http://www.tmonews.com/2010/07/t-mobile-closing-its-doors-in-2011-not-so-fast / last accessed on February 24, 2011
This acquisition gave Motorola the necessary services to expand their commercial divisions and also sell more effectively into enterprise-wide accounts. The use of mergers and acquisitions at Motorola for gaining differentiation and therefore delivering innovative solutions, freeing themselves from being a purely product-driven company illustrates how this strategy can be effectively used.
References
Abetti, Pier a (1994). Impact of technology on functional roles and strategies: Illustrative cases in the U.S.A., Japan, and France, and lessons learned. International Journal of Technology Management, 9(5,6,7), 529.
Retrieved September 10, 2008, from ABI/INFORM Global database. (Document ID: 879027).
ara ee (2008, February). Innovation at Risk. Business Week (Online),1. Retrieved September 13, 2008, from ABI/INFORM Trade & Industry database. (Document ID: 1428625341).
David Probert, Michael Radnor. (2003). Technology roadmapping: Frontier experiences from industry-academia consortia. Research Technology Management, 46(2), 26-30. Retrieved September 11, 2008, from ABI/INFORM Global database. (Document ID: 305041271).
Weekly Corporate Growth (2006). Motorola…
Lara Lee (2008, February). Innovation at Risk. Business Week (Online),1. Retrieved September 13, 2008, from ABI/INFORM Trade & Industry database. (Document ID: 1428625341).
David Probert, Michael Radnor. (2003). Technology roadmapping: Frontier experiences from industry-academia consortia. Research Technology Management, 46(2), 26-30. Retrieved September 11, 2008, from ABI/INFORM Global database. (Document ID: 305041271).
Weekly Corporate Growth (2006). Motorola to Acquire Netopia Inc. For 1.97 Times Revenue. (2006, November). Weekly Corporate Growth Report,(1416), 3. Retrieved September 11, 2008, from ABI/INFORM Global database. (Document ID: 1178968731).
corporate merger between Delta and Northwest airlines in order to find out the possible reasons why it was necessary. We evaluate the merits associated with corporate mergers and the challenges that might be faced in the process. A recommendation on how mergers should be carried out is also provided
Mergers and acquisitions form a very integral part of the contemporary corporate landscape. Kolker (2010) points out that initial six months of the year 2010 witnessed the total value of global acquisitions increase to 2.7% to a monetary value of $915 billion. This was an increase for the initial six months of 2009. 2010 however was off to a rather slow start as compared to 2006 which recorded an excess of $3.8 trillion in transactions related to acquisitions (Yeary, 2007). It is worth noting that it is never the volume of the deals that matter but their size. Averagely, there were…
References
Appelbaum, S., Lefrancois, F., Tonna, R. And Shapiro, B. (2007). Mergers 101 (part one):
Barney, J. (1991). Firm resources and sustained competitive advantage. Journal of Management, 17, 99-120.
Bijlsma-Frankema, K. (2001). On managing cultural integration and cultural processes in mergers and acquisitions, Journal of European Industrial Training, 25/2/3/4, 192-207
Brigham, EF & Houston, JF (2009).Fundamentals of Financial Management
Managing All Stakeholders in the Context of a Merger Process
Review of the Relevant Literature
Types of Mergers
Identifying All Stakeholders in a Given usiness
Strategic Market Factors Driving Merger Activity
Selection Process for Merger Candidates
Summary, Conclusion, and Recommendations
The Challenge of Managing All Stakeholders in the Context of a Merger Process
Mergers and acquisitions became central features of organizational life in the last part of the 20th century, particularly as organizations seek to establish and maintain competitiveness in an increasingly globalized economy (Nevaer & Deck, 1996). Mergers are generally described as being the formal joining or combining of two corporations or business (Prichett, 1987), although both the framework and the method of merger vary greatly. The reasons for mergers are different based on what a company is trying to accomplish. The acquiring firm may seek to eliminate a competitor; to increase its efficiency; to diversify its products, services,…
Bibliography
Ansoff, H. Igor. 1987. The Emerging Paradigm of Strategic Behavior. Strategic Management Journal, 8, 501-515.
Barney, Jay B. 1986. Strategic factor markets: expectations, luck, and business strategy. Management Science, 32, 10, 1231- 41.
Beinhocker, E.D. & Kaplan, S. 2002. Tired of Strategic Planning? Many Companies Get Little Value from Their Annual Strategic-Planning Process. It Should Be Redesigned to Support Real-Time Strategy Making and to Encourage 'Creative Accidents.' The McKinsey Quarterly, 49.
Black's Law Dictionary. 1990. St. Paul: West Publishing Co.
Globalization and Technological Influences
On International Mergers: DaimlerChrysler as a Case Study
One of the most interesting international manufacturing mergers of the 20th century was the 1998 negotiation between the Daimler auto company headquartered in Germany and the struggling Chrysler corporation, headquartered in the U.S. Daimler's buyout of Chrysler resulted in a merger that ultimately failed to benefit either party, and may have seriously damaged both organizations' capacity for future growth. Below, I will discuss how the merger proceeded -- as it was covered in U.S. And international business media -- and how the negotiations for the merger and the 2007 spinoff of Chrysler were facilitated by technological developments and global business practices. I will also discuss motivations for international mergers in general and how they applied specifically in the case of the DaimlerChrysler merger.
As a horizontal merger, DaimlerChrysler followed a popular movement towards consolidation in the international auto…
References
Qiu, L., & Zhou, W. (2003). International Mergers: Incentive and Welfare. Journal of International Economics, 68(1): 38-58.
Landler, M., & Maynard, M. (2007). "DaimlerChrysler stock gets a lift from talk of Chrysler spinoff." International Herald Tribune, Tuesday February 20, 2007.
Finkelstein, S. (2001). The DaimlerChrysler Merger. Tuck School of Business White Paper # 1-0071.
Vlasic, B., & Stertz, B. (2001). Taken for a Ride: How Daimler-Benz Drove Off with Chrysler. New York: Harper Perennial.
Executive eport on Financing the Acquisition
Financing of an acquisition is one of the challenging aspects when it comes to a company with some few assets unlike the one to be acquired. Paying in cash would not be a viable option putting into consideration the lack of capital involving JC Penney. Its market valuation is only one-third of the value of Kohl, which stands at $6.9 billion. Therefore, the use of shares is inappropriate because enough capital to pay for the acquisition cannot be obtained. Financing the acquisition requires significant cooperation between all the partners in the deal because JC Penney does not have the resources needed to complete the acquisition immediately. Some risks are also involved as all the equity belonging to JC Penney will have to go into the deal. In this case, the cash flow belonging to JC Penney would be used as the collateral in the…
References
Bates, T. W., Neyland, J. B., & Wang, Y. (2016). Financing Acquisitions with Earnouts.
Elsas, R., Flannery, M. J., & Garfinkel, J. A. (2014). Financing major investments: information about capital structure decisions. Review of Finance, 18(4), 1341-1386.
Fischer, M. (2017). The source of financing for mergers and acquisitions. The Quarterly Review of Economics and Finance.
The advantage on the other hand is of the retrieval of relevant and solid findings based on which the adequate strategies can be implemented.
4. The congruence model
According to the Mind Tools website, the "congruence model is based on the principle that an organization's performance is derived from four elements: tasks, people, structure, and culture. The higher the congruence, or compatibility, amongst these elements, the greater the performance" (Mind Tools, 2010). The advantage of the model is that of simplifying the issues promoted by the previous models and revealing an analysis structure constructed onto four elements alone. This implies lower task complexities and leads to more efficiently retrieved results. However, it could also lead to sometimes irrelevant findings as it does not take into consideration elements outside the organization, such as the socio-economic climate. In other words, this model is highly applicable when conducting an internal audit, but its…
References:
Burton, R.M., Obel, B., 2004, Strategic organizational diagnosis and design: the dynamics of fit, 3rd edition, Springer, ISBN 1402076843
Patel, N., 2010, HP and Palm: what happens next, Engadget, http://www.engadget.com/2010/04/29/hp-and-palm-what-happens-next / last accessed on July 29, 2010
A causal model of organizational performance and change (Burke & Litwin model), Reflect and Learn, http://www.reflectlearn.org/discover/a-causal-model-of-organizational-performance-change-burkes-litwin-model last accessed on July 29, 2010
Organizational diagnosis, The College of St. Scholastica, http://www.google.com/url?sa=t&source=web&cd=1&ved=0CBIQFjAA&url=http%3A%2F%2Ffaculty.css.edu%2Fdswenson%2Fweb%2FPowerpoints%2FOrganizationalDiagnosis.ppt&ei=uYdRTKSkMYqUOMy-4cME&usg=AFQjCNGTL9ElrN8D8QlJeGZvTwHnunMKeA last accessed on July 29, 2010
Apple Inc.
An Analysis of Apple's Operations and Acquisition Potential
Apple is one of the world's premier manufactures of a product mix consisting of electronics goods, and related software applications, in a broad range of different industry segments. The organization is known for producing first-class products that are uniquely designed within a quality niche and this strategy has garnered a loyal customer base over the years of the company's development. The company also provides services, such as software and software updates, that are regularly applied to existing products, and Apple also offers a range of service programs that are focused on the physical maintenance and service of the products that it sells as well. The company has a global supply chain that spans the globe and markets its products in a number of different international markets.
Apple's current mission statement is "Apple designs Macs, the best personal computers in the…
Works Cited
Anthony, S. (2016, March 22). Apple in "advanced talks" to acquire Imagination Technologies for PowerVR GPU. Retrieved from Ars Technica: http://arstechnica.com/apple/2016/03/apple-acquire-imagination-powervr-gpu/
Investopedia. (2015, April 23). What is Apple's current mission statement and how does it differ from Steve Job's original ideals? Retrieved from Investopedia: http://www.investopedia.com/ask/answers/042315/what-apples-current-mission-statement-and-how-does-it-differ-steve-jobs-original-ideals.asp
Meyer, P. (2015, September 4). Apple's Generic Strategy & Intensive Growth Strategies. Retrieved from Panmore Institute: http://panmore.com/apple-inc-generic-strategy-intensive-growth-strategies
Moore, M. (2010, February 27). Apple admits using child labour. Retrieved from The Telegraph: http://www.telegraph.co.uk/technology/apple/7330986/Apple-admits-using-child-labour.html
Change esistance
Human beings are by nature change-resistant and particularly within an organizational context there is anxiety about change, given fears of job losses or simply being unable to adapt. It is essential to convince change agents of the need and urgency for change and also of the congruency of the change with the evolving vision for the company.
Vision statement
A "vision statement should have four elements: a customer orientation, employee focus, organizational competencies, and standards of excellence" ("Changing the game," 2015:3). The change should be demonstrated to enhance all of the organization's capacities, not simply improve its bottom line in the short-term. Having an effective vision statement is necessary for effective change. The Lewin Model of organizational change stresses the need for a three-part adaptation process called unfreezing, changing, and refreezing. In other words, the organization must be temporarily destabilized or unfrozen before it returns to a new…
References
DiMaggio, M. (2009). The top 10 best (and worst) corporate mergers of all time... or, the good, the bad, and the ugly. Rasmussen. Retrieved from:
http://www.rasmussen.edu/degrees/business/blog/best-and-worst-corporate-mergers/
McClure, B. (2015). Mergers and acquisitions: Why they can fail. Investopedia. Retrieved from:
http://www.investopedia.com/university/mergers/mergers5.asp
International Strategies
Whole Foods Market (WFM) is a grocery store chain that has operations in the U.S., Canada and the UK. Competitor The Fresh Market (TFM) is based only in the United States at this point. While Whole Foods is substantially bigger, these two companies are close competitors of one another based on the similarity of their product lines and their target markets. This paper will analyze the strategic tactics of each of these companies, based on their respective growth strategies.
The Merger & Evaluation
By 2007, Whole Foods was becoming the dominant player in the natural foods grocery business. It sought to grow further, and decided to purchase struggling competitor Wild Oats (Fineman, 2007). At the time, Whole Foods paid $18.50 in cash for each share of Wild Oats. There was concern from the Federal Trade Commission about the deal, because it put Whole Foods in a dominant position…
References
Bartz, D. (2009). Whole Foods, FTC settle on Wild Oats merger. Reuters. Retrieved November 30, 2013 from http://www.reuters.com/article/2009/03/06/us-wholefoods-ftc-idUSTRE5253AL20090306
Fineman, J. (2007). Whole Foods agrees to buy Wild Oats; profit declines. Bloomberg. Retrieved November 30, 2013 from http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aZtDQutxeDsU
MSN Moneycentral. (2013). Whole Foods. Retrieved November 30, 2013 from http://investing.money.msn.com/investments/stock-price?symbol=WFM&ocid=qbes
MSN Moneycentral. (2013). The Fresh Market. Retrieved November 30, 2013 from http://investing.money.msn.com/investments/stock-price?symbol=TFM&ocid=qbes
merger of Time with warner is economically very attractive this is contributed by high value enhancement opportunities. This value enhancement opportunity reveals clearly the existence of a merger between Time with Warner. Motives present included:
How attractive is the merger of Time with Warner? What are the value enhancement opportunities?
Existence of horizontal merger. This existence leads to economies of scale.it represents combination of two firms in the same line of business (Allen, 2008, p.68).Time and warner are in the same line of business hence this can be considered as horizontal. The prime advantage of this is that there is sharing of central services such as office management and accounting, financial control, executive development and top level management consolidating operations hence elimination of redundant costs.
Vertical merger .this involves companies at different stages of production. Vertical mergers seek economies of scale in vertical integration this is gained by spreading fixed…
REFERENCE
Allen, (2008) corporate finance, p.68.
Dingman Michael, (2011) paramount vs. Time, p.360.
Mergers, Acquisitions and Downsizing
How does the role of a company's motivation determine the selection of a business initiative of a merger, acquisition or a downsizing? Your answer should summarize the role of the economies of scale and be adapted to include a corporate example (current or past employer should be utilized).
The current employer that will be examined is how various services are delivered to the public from local government officials. During this process, there was a focus on downsizing various departments and merging others together. This is illustrating how administrators are concentrating on reducing costs and increasing the quality of services being provided. In most cases, this means that many programs are reorganized and the role of government (as a part of process) is brought into question. As the traditions of providing various services and expanding the number of programs, has not effectively addressed the underlying challenges impacting…
References
Aaker, D. (2001). Developing Business Strategies. New York, NY: John Wiley & Sons.
DiNapolli, D. (2009). Shared Services in Local Government. New York State Comptroller.
Peed, J. (2007). North Carolina LEA Services. Department of Public Instruction.
Stanley, S. (1992). Bigger is Not Better. Policy Analysis.
Business
Regulation of Mergers and Implications of Government Intervention - the Case of a Potential Merger for Blockbuster
When a large firm in a mature industry wants to grow a common strategy will be the seeking of an acquisition or merger. However, large firms in an industry will often be faced with government regulation which may seek to control and limit the way merger activity takes place. For example, if Blockbuster, a major film rental company, wishes to merge with another firm they may face barriers, while these barriers may be seen as good for competitive environment, they may be perceived by Blockbuster as limiting their commercial actions.
It may be argued that government regulation of needed in the markets for a number of reasons. The first may be the role of the government in protecting the market system to ensure that competition remains in a market. Where one firm…
The Birdie Golf – Hybrid Golf Merger
Hybrid Golf and Birdie Golf are two companies that have been engaging in talks of merging their company in the past 6 months or so. It is imperative to note that both of these companies are in good position on their own and have niche markets. Moreover, the contemplations of proceeding with the merger is encouraged owing to the fact that it is deemed a beneficial transaction for both of them if the merger actually takes place. In addition, both Birdie and Hybrid will enjoy economies of scale that come along with the transaction. At the present moment, the price at the table is $68.75 for every share of Hybrid’s stock. The purpose of this paper is to conduct a comprehensive analysis regarding the expected value of Hybrid so as to determine whether the price given ought to be accepted by Birdie or…
Mergers & Acquisitions
One of the more fascinating and complex part of corporate news and maneuvering is when companies engage in mergers and acquisitions as a means to further their growth, development and diversification. This report shall look at two companies in particular, those being Mattel and Texas Instruments. After conducting a thorough literature review, questions about both firms will be posed and answered. While there is more than one way to launch a takeover or acquisition bid for a firm, there are some ways and methods that are better than others.
Mattel Case Study
Now that the literature relative to mergers and acquisitions has been properly sampled and queried, it should now be ascertained what the answers are to the questions described in the introduction, with Mattel being the first firm addressed. Mattel has proven themselves to be concerned with branching out and modernizing their product mix and feel…
References
Alexandridis, G., Petmezas, D., & Travlos, N. (2010). Gains from Mergers and Acquisitions Around the World: New Evidence. Financial Management, 39(4), 1671-1695. http://dx.doi.org/10.1111/j.1755-053x.2010.01126.x
Bhagwat, V., Dam, R., & Harford, J. (2016). The Real Effects of Uncertainty on Merger Activity. Review Of Financial Studies, 29(11), 3000-3034. http://dx.doi.org/10.1093/rfs/hhw061
Brealey, R., Cooper, I., & Kaplanis, E. (2009). Excess Comovement in International Equity Markets: Evidence from Cross-border Mergers. Review Of Financial Studies, 23(4), 1718-1740. http://dx.doi.org/10.1093/rfs/hhp104
Bris, A., & Cabolis, C. (2008). The Value of Investor Protection: Firm Evidence from Cross-Border Mergers. Review Of Financial Studies, 21(2), 605-648. http://dx.doi.org/10.1093/rfs/hhm089