Merger & Acquisition
MERGER & ACQUISITION
Description also available in video format (attached
below), for better experience use your desktop.
Introduction
·
Merger is the
combining of two or more companies, generally by offering the stockholders of
one company securities in the acquiring company in exchange for the surrender
of their stock.
·
Acquisition is a
condition when one company takes over another company and clearly established
itself as the new owner, the purchase is called an acquisition
·
Generally acquisition is considered negative
in nature
Process
of M&A
· Deal sourcing & Origination
· Initial screening
· Preliminary due diligence
· Indicative offer
· Negotiation
· Full due diligence
· Internal approvals
· Finalize agreements
· Closing
· Integration
· Growth & Acquisition strategy
Motives,
Benefits & Problems of M&A
·
Motives
o
Economies of large scale business
o
Elimination of competition
o
Desire to enjoy monopoly power
o
Adoption of modern technology
o
Lack of technical & managerial talent
·
Benefits
o
Greater value generation
o
Gaining cost efficiency
o
Increase in market share
o
Gain higher competitiveness
·
Problems
o
Integration difficulties
o
Large debts
o
Extraordinary debt
o
Managers overly focused on acquisition
o
Overly diversified
Impact
& Strategies of M&A
·
Impact
o
Employees
o
Top level management
o
Shareholders of the acquired firm
o
Shareholders of the acquired firm
·
Strategies
o
Future market opportunities
o
Recent trends
o
Customer’s feedback
o
Restructuring Plans
o
Future parameters consideration
o
Consent of the management
Examples
·
Tata Steel-Corus
·
Vodafone-Hutchison Essar
·
Tata Motors-Jaguar Land Rover
·
ONGC-Imperial Energy
·
RIL-RPL merger
·
Air India & Indian Airlines
Video
Description
·
Don’t forget to do
these things if you get benefitted from this article
o
Visit our Let’s
contribute page https://keedainformation.blogspot.com/p/lets-contribute.html
o
Follow our page
o
Like & comment
on our post
·
Comments