Please enable JavaScript.

Coggle requires JavaScript to display documents.

MERGER, TAKEOVER & ACQUISITION (:star:The Principals (Internally :pen…

- - - - 🎈 Reason for mergers
        
        :fire: Non-financial Motives
        
        🎇 Business Expansion
        
        aim to expand their business activities or increase market share can use merging activities as means to be the business giants
        
        🎇Guaranteed Sources of Funding
        
        by merging with more liquid assets and low liability company. By merging with cash rich firms, able to finance much of the needed funds.
        
        🎇 Greater Market Accessibility.
        
        merging also enable firms to have greater access to the international.
        
        🎇 Synergy
        
        economies of scale resulting from synergy of the combined firms either in the same line of business or even in a different line of business.
        
        this may reduce redundant functions and employees thus enhance the productivity of merged firms and minimize the operational cost of firms.
        
        :recycle: Strategic of Synergy
        
        🌍 Operational synergies
        
        🌍 Managerial synergy
        
        🌍 Financial sysnergy
        
        :fire: Financial Motives
        
        🐰The bidding firms can enjoy a potentially desirable portfolio risk reduction while maintaining the firm's potential rate of return.
        
        🐰 The merged firms will be in in a better position for raising much needed capital through the market.
      - b) Vertical merger
      - d) Conglomerate merger
      - c) Congeneric merger
      - a) Horizontal merger
    - - c) Acquisition of assets.
        :red_flag: a firm can effectively acquire another firm by buying most or all of its assets. This accomplishes the same thing as buying the company.
      - b) Acquisition of stock
        :red_flag: acquire another firm is to simply purchase the firm's voting stock with an exchange of cash, shares of stock or another securities.
      - a) Merger
        :red_flag: the complete absorption of one company by another, where in the acquiring firm retains its identity and the acquired firm ceases to exist as a separate intity.