Merger And Aquisition

M&A is explained as creating greater stockholder value. piece of ground makeer interests be central because these transactions must have the approval of a majority of stockholders and stockers are unlikely to vote their shares in favor of a sale, puechase or merger unless they believe that they surrender behind benefit. However, the real motivation behind M&A is about al rooms a mixture in which financial, structual, institutional, and hitherto personal aims are present. Companies make acquisitions to grow more rapidly, to gain understand over theor raw materials, to obtain invigorated technology, to pump up their stock, to take advantage of weaknesses in others, to turn, etcetera Greed, or self-importance intesest, is the primary reason to establish an imagination for M&A. It plays dandy and bad roles for motivating M&A. ?If the company and the management group is greed, they suffer use M&A to add the securities industry share. Since each company has its spec ial client groups and product reputation, it has its own market share in the industry. unrivalled company can increase its market share it does non have with M&A. For example, HP acquired Compaq in 2001. HP could increase its market share of printer, scanner and cameras because Compaq had a big node undercoat for these products. Compaq can help HPs kick upstairs into the commercial-printing market.

The lucrative imaging and printing unit will go from universe 43% of HPs business to 25% of the combine company. ?Since the economic environmen is uncertain, a company should find a port to resisit to the economic shock. Greed makes the company struggle to snuff it even under the eco nomic reccession. The most effective way is ! to diversify its products. Greed can force the comany to complemnting its product offerings on and on for diversity through M&A. afterwards the products are diversified, the company can still keep operating substantially when encountering an receding in one or some of its products. HP is whole in the consumer machines but Compaq is stong in the business PCs. After M&A, HP can also...If you want to get a liberal essay, order it on our website: OrderEssay.net

If you want to get a full information about our service, visit our page: write my essay