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How Mergers And Acquisitions Affect Shareholders' Wealth in Short Term: the European Market - Dissertation Example

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How Mergers And Acquisitions Affect Shareholders' Wealth in Short Term: the European Market

Market reaction towards merger or acquisition announcement: 13 2.8. Determinants of share price: 13 2.9. Motives behind takeovers: 14 2.10. Intricacies of Mergers and Acquisitions: 15 2.11. Merger and Acquisitions Waves: 16 2.12. Trend of Mergers and Acquisition in Europe in 1990s: 16 2.13 Empirical Evidence of Impact of Mergers and Acquisitions on the Shareholders’ Wealth: 18 2.14 Steps to follow while undertaking a Merger and Acquisition Strategy: 23 3. Research Overview and Methodology 25 3.1 Introduction: 25 3.2 Research Overview: 25 3.3 Problem Statement: 29 3.4 Research Objectives and Questions: 29 3.5 Research Purpose: 30 3.6 Research Approach: 30 3.7 Research Strategy: 31 3.8 Research Method and Data Collection: 32 3.9 Variables under Investigation: 33 3.9.1 Dependent Variable: 33 3.9.2 Independent Variable: 33 3.10 Conceptual Framework: 34 3.11 Hypothesis: 34 3.12 Ethical Issues and Considerations: 34 3.13 Limitations: 35 3.14 Summary: 35 4. Analysis and Findings 36 4.1 Introduction: 36 4.2 Case Study Analysis: 36 4.2.1 Case Study of Apollo Global Management and CVC Capital Partners acquisition of Brit Insurance: 36 4.2.2 Case Study of Kraft’s acquisition of Cadbury: 37 4.2.3 Case Study of URS Corporation’s acquisition of Scott Wilson Group: 39 4.2.4 Case Study of Vodafone’s acquisition of Mannesmann AG: 41 4.2.5 Case Study of SAB Miller Plc. Acquisition of Royal Grolsch NV: 43 4.2.6 Case Study of Air France-KLM Merger: 47 4.2.7 Case Study of GlaxoSmithKline (GSK) Merger: 49 4.2.8 Case Study of Credit Agricole acquisition of Credit Lyonnais: 52 4.2.9 Case Study of Banco Santander acquisition of Abbey: 53 4.2.10 Case Study of Tata Tea’s Acquisition of Tetley: 55 4.3 Hypothesis Testing: 56 4.4 Summary: 57 5. Conclusion and Recommendations 58 5.1 Conclusion and Summary of Findings: 58 5.2 Recommendations: 59 List of References 61 Appendix 70 Reflection 73 1.0 Introduction 1.1. Overview of the research study Globalisation has provided organisation the flexibility to expand their products and services in different parts of the world and this has increased the level of competition in different industries today. With greater level of competition, small and medium sized organisations face problems and difficulties in competing against some of the giants in the industries and therefore it creates problems for these small and medium sized firms. So in order to compete against the giants of the industry that are dominating the market, one of the strategies that organisations have come up with is merger and acquisition. A merger is usually defined as a situation when an organisation and its assets along with its liabilities are merged with another company’s assets and liabilities. In other words, it can be said as the merging of two or more firms to make one organisation (Cognizant, 2010). With mergers, the power and strength of the merged organisation increases and it is better able to compete against the competitors in comparison to the other firms in the market. Thus, the merged firm is able to compete against the giants with more resources and more strength and thus it is able to give tough time to its competitors. There are several advantages and benefits that organisations avail after merging with another firm and some of the most important benefits include cost reduction, achieving economies of scale, taking advantage of better technology or other resources of the other firm, getting access to more ...Show more

Summary

Table of Contents 1.0 Introduction 4 1.1. Overview of the research study 4 1.2. Rationale of the research study 6 1.3. Significance of the research study 6 1.4. Problem Statement 7 1.5. Objectives of Research Study 7 1.6. Hypothesis 7 1.7. Research Methodology: 8 1.0.Literature Review: 9 2.1…
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How Mergers And Acquisitions Affect Shareholders Wealth in Short Term: the European Market essay example
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