Reference no: EM132229990

1. Joint venture: JV's are the most preferred form for doing business. A joint venture is when two parties, incorporate a company and business of one party is transferred to the company and as consideration for such transfer, shares are issued by the company and subscribed by that party.

The example of Joint venture is Hero and Honda groups JV that lasted for two decades approx and made Hero group vibrant as they learned how to do business in two wheeler market and also developed expertise in making and producing best of the components with the help of Honda technology transfer for the JV.

2. Equity strategic alliance: This is an alliance in which two or more entities combine their resources and capacities to create competitive advantage from the combined units as a whole.

3. Non equity alliances are the form of combinations of two or more firms that combine to transfer their expertise to each other for commission or fees. This is how they work for their mutual benefits.

As discussed in the notes for this week, horizontal integration helps in reducing competitive intensity, lowering costs, boosting differentiation, and providing access to new markets and distribution channels for a company. For this week’s CTE, please explain each of the below questions in a separate section:

1) List one example each of a contractual agreement (non-equity alliance), an equity alliance, and a joint venture that is not listed in your textbook or PPT slides.

2) Explain in detail why each of the above agreement or M&A is a contractual agreement, an equity alliance and a joint venture according to you.

3) For each of the three agreement and M&A listed earlier, describe the advantages accruing to both the participating parties by providing clear evidence using relevant references/citations.