What are the major advantages and disadvantages of mergers and acquisitions?
These are 6 discussion quest is that needs responses to EACH question six in total. APA format atleast one paragraph in length cite in paragraph wherever needed and no cover sheet needed. This is a MBA Level course so grammar and reference page needed.
1.e term acquisition is the incorporation of one firm into another through purchase (p.193). With acquisitions one organization buys another it can be either through stock purchases cash or the issuance of debt. The term mergers is the combining of two or more firms into one new legal entity (p.193). Mergers is the combination or consolidation of two firms to form their new business. Mergers tend to be more of the rare instances and have to have a transactions among the two firms on a total equal basis. Even though there are some differences between both they are basically the same. Some advantages of mergers and acquisitions are that it can help an organization expand its products and offerings and services it can provide the opportunity for firms to attain the three bases of synergy-leveraging core competencies sharing activities and building market power they can also lead to consolidation within an industry and can force other players to merge and corporations can also enter into new market segments by the way of acquisitions (p.194-195). Even though acquisitions and mergers have some good advantages they also have some limitations. The first limitation is the takeover premium that is paid can be high (p.195). An interesting fact is that with an company that is taking over two of three times the stock price falls once the deal is made public. Therefore it is in a companies best interest to not pay a higher premium over the acquiring companys stock price due to it being a poor strategy. The second limitation is competing firms often can imitate any advantages realized or copy synergies that result from the M&A. The third disadvantage is a managers credibility and ego can sometimes get in the way of sound business decisions (p.196).
In many cases if the M&A doesnt get performed the way its supposed to it causes the managers overall reputation to turn bad. Leading them to want to protect their reputation and credibility by putting more money or pushing their commitment further into a doomed operation (p.196). Most of the time when mergers or acquisitions head south. The morale of the employees drop and synergies fail to materialize. Those key employees that are in the organization are quitting. Most of the time the biggest problems of these are their is a culture clash. In a culture clash the companies fundamental ways of working are so different and so easily interpreted that people feel frustrated and anxious leading to demoralization and defections. There are productivity flags and the company has a hard time finding fixes. Most of the time the acquirers have these well developed toolkits for managing the financial and operational aspects of the deal they track the overall results and hold who needs held accountable for hitting their targets but integrating two disparate cultures are both difficult to measure and almost impossible to manage directly. Resulting in few organizations applying the same kind of rigor to managing and steering cultural integration that they apply to the regular synergy. At this point no one is accountable senior leader often find themselves in non favorable positions of watching these problems unfold (p.194-200).
A current merger that has happened that many of us individuals know about is the merger of Oconee Medical with Greenville Health. The merger is to help ensure that high quality medical care continues to be provided in our area. The boards of directors of both companies approved a 32 page binding agreement by which OMC becomes a part of the GHS system though a lease of the Seneca hospital. The first lease will run for 50 yrs. with options to renew for two additional 25 year terms. OMH was the eighth hospital to enter into the GHS network. This merger was supposed to make a positive impact on the health of the communities we serve by improving access quality and value. The two systems say they share the same goals of making their communities healthier not just treating the sick. OMH was reported to have said the merger itself was the best way to ensure that the hospital was able to survive (Oconee Medical Approves Merger with Greenville Health n.d.).
PLACE THIS ORDER OR A SIMILAR ORDER AND GET HELP FROM A CERTIFIED WRITER:)
Click the button below to order this paper AND ENJOY OUR DISCOUNT.
The post What are the major advantages and disadvantages of mergers and acquisitions? appeared first on Nonplagiarizedpapers.
I absolutely LOVE this essay writing service. This is perhaps the tenth time I am ordering from them, and they have not failed me not once! My research paper was of excellent quality, as always. You can order essays, discussion, article critique, coursework, projects, case study, term papers, research papers, reaction paper, movie review, research proposal, capstone project, speech/presentation, book report/review, annotated bibliography, and more.
Ask a Question. Get an Answer ASAP!