1 / 13

Mergers & Acquisitions in Finance

Mergers and Acquisitions are important events in today’s business scenario. It is the phenomenon of either two or more companies coming together to form into one bigger organization or buyout of one company by another.

assignment_maker
Download Presentation

Mergers & Acquisitions in Finance

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Mergers & Acquisitions in Finance www.HelpWithAssignment.com

  2. Mergers and Acquisitions • Mergers and Acquisitions are important events in today’s business scenario. • It is the phenomenon of either two or more companies coming together to form into one bigger organization or buyout of one company by another. www.HelpWithAssignment.com

  3. What is Merger? • These are business transactions in nature involving payment for each unit of stock. • A merger is a consolidation of two or more companies into one, an entirely new company. www.HelpWithAssignment.com

  4. What is Acquisition? • Acquisition on the other hand is the transfer of ownership and control of one company from the one group of shareholders to another. • Leveraged buyout is observed in cases where a large proportion of debt is used for financing the buyout. www.HelpWithAssignment.com

  5. Types of Mergers • Mergers and Acquisitions come under three broad categories called • Horizontal • Vertical • Conglomerate www.HelpWithAssignment.com

  6. Horizontal Merger • A Horizontal Merger is a merger taking place between companies belonging to one industry. The products of these companies are close substitutes. www.HelpWithAssignment.com

  7. Vertical Merger • A Vertical Merger is a merger which takes place between companies belonging to same industry, but the line of business is different. • For example, a company in the telecommunications industry acquiring an internet service provider. • Or a mobile phone based company acquiring a land phone based company. www.HelpWithAssignment.com

  8. Conglomerate Merger • A Conglomerate Merger is a type of merger in which companies which are totally unrelated coming together. • For example, a company which is producing heavy engineering products acquiring a 7star chain of hotels can be considered as Conglomerate merger. www.HelpWithAssignment.com

  9. Why Corporations merge? • Why do companies buy other companies or two or more companies merge into one large company? • The reason is that it is very easy to exercise market control when the amount of competition is reduced. www.HelpWithAssignment.com

  10. Reasons for Merging or Acquiring • Other reasons include growing economies provide better opportunities which are best made use only through combining companies. • In an economy troubled by ever-increasing prices of raw materials, mergers and acquisitions provide economies to scale in production. www.HelpWithAssignment.com

  11. Reasons for Merging Contd… • An entry into a new market can be made easier by acquiring an existing company. • In this way, the expertise of the acquired company and the capital from the acquiring company can produce a new product whose cost can be very low when compared to other products in the market. www.HelpWithAssignment.com

  12. Mergers and Acquisitions • With the above advantages, mergers and acquisitions take place in an economy, which can give a different shape to the industry. www.HelpWithAssignment.com

  13. www.HelpWithAssignment.com • For more details visit our websites at • http://www.helpwithassignment.com/finance-assignment-helpand • http://www.helpwiththesis.com www.HelpWithAssignment.com

More Related