Presentation Transcript
Slide1: Mergers and Acquisitions Merger A transaction where two firms agree to integrate their operations on a relatively coequal basis because they have resources and capabilities that together may create a stronger competitive advantage Acquisition A transaction where one firm buys another firm with the intent of more effectively using a core competence by making the acquired firm a subsidiary within its portfolio of businesses Takeover An acquisition where the target firm did not solicit the bid of the acquiring firm
Slide2: Problems in
Achieving Success Reasons for
Acquisitions
Slide3: Reasons for Acquisitions Example: Belgian-Dutch Fortis’ acquisition of American Banker’s Insurance Group Example: Watson Pharmaceuticals’ acquisition of TheraTech Example: British Petroleum’s acquisition of U.S. Amoco
Slide4: Example: General Electric’s acquisition of NBC Example: Kraft Food’s acquisition of Boca Burger Example: CNET’s acquisition of mySimon Reasons for Acquisitions
Slide5: Problems with Acquisitions Example: Marks and Spencer’s acquisition of Brooks Brothers Example: Intel’s acquisition of DEC’s semiconductor division Example: AgriBioTech’s acquisition of dozens of small seed firms
Slide6: Example: Ford and Jaguar Example: Quaker Oats and Snapple Example: GE--prior to selling businesses and refocusing Problems with Acquisitions
Slide7: Attributes of Effective Acquisitions
Slide8: Attributes of Effective Acquisitions
Slide9: Downscoping Reduced Debt Costs Downsizing Reduced Labor Costs Loss of
Human Capital Lower Performance Alternatives Short-Term Outcomes Long-Term Outcomes Restructuring and Outcomes