Rationale for mergers-product advantages, Financial Management

Assignment Help:

Product Advantages:

A firm that has developed a reputation for superior products in the domestic market may find acceptance from the foreign consumers as well. Hence, such firms foray into other countries to exploit the favorable market conditions of that country.

Government Policy

Government policies, regulations, tariffs and quotas play a great role in the merger and acquisition activity in a country and more significantly in cross-border deals. The exports of a country are particularly very vulnerable to the tariffs and quotas mainly implemented by the government with an intention to protect the domestic industry. The presence of such restrictions encourages international mergers, especially when the market which is protected is large. Restrictions on exports in a country can result in increased direct investment in countries to where the goods were supposed to be exported. Occasionally, the environment and other government regulations increase the cost and also the time required to build facilities abroad. This may lead to acquisitions of companies with already existing facilities.

Changes in the government policy can make acquisitions in various countries more or less attractive. For example, the deregulation policies followed by the Government of India have encouraged many foreign companies to acquire Indian firms in the recent years.

 


Related Discussions:- Rationale for mergers-product advantages

Discount and premium, What is the  Discount and Premium? Describe please.

What is the  Discount and Premium? Describe please.

Cost of capital, The Nu-Nu Brothers Inc. (NNBI) has the following capital s...

The Nu-Nu Brothers Inc. (NNBI) has the following capital structure, which it considers to be optional: Debt 25% Preferred Stock 15% Common Equity 60% NNBI''''s expected net income

Case study on labour standars, describe the impact of different types of st...

describe the impact of different types of standards on motivation, and specifically , the likely effects on motivation of adopting the labor standards recommended for geeta & compa

Banking sector securities, The banking sector has a vital and active ...

The banking sector has a vital and active role in the money market. The transactions taking place in these securities are large in size, both in terms of volumes

What is installment credit, Q. What is Installment Credit? This is anot...

Q. What is Installment Credit? This is another method by which the assets are purchased and the possession of goods is taken immediately but the payment is made in installments

Steps, how control the steps

how control the steps

Swing traders, Swing Traders Swing trading is more or less similar to d...

Swing Traders Swing trading is more or less similar to day trading except that swing traders will normally have a longer holding period during a working day. Swing traders also

Define coefficient of variation often a better risk measure, Why is the coe...

Why is the coefficient of variation often a better risk measure when comparing different projects than the standard deviation? While we want to compare the risk of investments whi

Explain about the non-convertible debentures, Expalin about the Non-Convert...

Expalin about the Non-Convertible Debentures (NCDs) NCDs are plain debenture securities issued by corporations. They are normally medium term in nature, maturing between 1 to 8

Illustrate the comparison between equity and debt, Illustrate the compariso...

Illustrate the comparison between equity and debt Equity and Debt: A Comparison 1. Equity shares don't carry any fixed charges on them. If company doesn't generate positiv

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd