Corporate Strategy, Finance, Other Engineering

Assignment Help:

Corporate Strategy

Strategy

In our earlier discussion, we made distinctions between merger and acquisition or takeover. However, they generally involve similar analyses and evaluations. A merger or acquisition might be considered successful if it increases the shareholder value. Though it is quite difficult to say how the firm would have performed without merger or acquisition, but the post-merger poor performance would be attributed as a failure of merger or acquisition. What are the chances that mergers or acquisitions would succeed? Empirical evidence shows that there is more than fifty per cent chance that they would succeed.

There are several reasons responsible for the failure of a merger or acquisition. They include:

1. Excessive premium: - an acquirer may pay high premium of acquiring its target company. The value paid may far exceed the benefits. This happens when acquirer becomes to eager to acquire the target for prestige or increasing the size of its empire.

2. Faulty evaluation: - at times acquirers to not carry out the detailed diligence of the target company. They make a wrong assessment of the benefits from the acquisition and land up paying a higher price.

3. Lack of research: - acquisition requires gathering a lot of data and information and analyzing it. It requires extensive research. A shoddily carried out research about the acquisition cause the destruction of the acquirer’s wealth.

4. Failure to manager post- merger integration: - many times acquirers are unable to integrate the acquired companies in their businesses. They overlook the organizational and cultural issues. They do not have adequate understanding of the culture of the acquired companies which creates problem of integration and synergy.

Write Your Message!

Name

Email id

Message

Verfication Code

User Account

All Pages

Corporate Strategy, Finance, Other Engineering

Related Discussions:- Corporate Strategy, Finance

Servicing of chemical de-icing systems, SERVICING OF CHEMICAL DE-ICING SYST...

What is the difference between real money & nominal money?, What is the dif...

Accurate design of heat transfer systems, Hollow cylinders are useful build...

Directional solidification, Q. What do you understand by directional solidi...

Comparator, Comparator A comparator is a device, which compares two inp...

Material properties and selection, conclusion

Engineering Management, what is the best Master thesis that can be done i...

Cadmium telluride, what are the manufacturing processes used in cadmium tel...

Heat and mass transfer, 1. Air at 1 atm, 90F, and 8 ft/s enters a thin-wall...

Variation of energy bands with alloy composition, variation of energy bands...

Write Your Message!

Featured Services

Online Tutoring

Project Development

Exam Preparation

Course Help

Assignment Help

Popular Subjects

Assured A++ Grade

Academics

Major Subjects

Majors

Get In Touch

TERMS & POLICIES

HELP & SUPPORT