Reference no: EM133090473

You are an executive with a manufacturer and seller of soft drinks in the country of Astrida and you have been called in for a chat with your managing director. There are rumours that your major competitor has decided to acquire an Astridan confectionery company and your boss is wondering if your company should think about doing the same. You know that there is another Astridan confectionery firm that might be available for a merger and you have told your managing director about this. That firm also serves just the domestic market. Your managing director has told you to make the case for and against merger in writing - but also to consider joint venture with the confectionery firm as an alternative to merger. To help your managing director make her decision, you are setting out to answer three questions:

Questions

(a) What major gains might be worth seeking from such a merger?

(b) What kind of problems does past experience warn might be encountered in such a merger?

(c) What could be the pros and cons of pursuing joint venture as an alternative to merger?