Essay sample - Mergers and Acquisitions as a Strategic Mean of Creating Value and Maximizing Shareholder Wealth

Mergers and Acquisitions as a Strategic Mean of Creating Value and Maximizing Shareholder Wealth Essay example
Masters
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Finance & Accounting
Pages 12 (3012 words)
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Mergers and Acquisitions as a Strategic Mean of Creating Value and Maximizing Shareholder Wealth By [Name of student] [Presented to] [Name of institution] [Date] INTRODUCTION Organisations in the current business environment thrive for success and creation of value…

Introduction

An Overview of Mergers and Acquisitions DePamphilis (2008 pp-04-06) defined mergers and acquisitions as a part of corporate and management strategies dealing with the buying, selling and combining of different organsiations having similar business activities or activities that can support the present and future growth and development in a systematic manner. Over the years, the distinction between mergers and acquisitions has become quite blurred in respect to economic outcomes but continues to attract organisations (Cartwright, Schoenberg, (2006 pp. 11-14). Studies have shown that 50% of acquisitions have been unsuccessful considering the complex process and different dimensions associated with the actual outcomes (Straub, 2007). Lazonick, O'Sullivan, (2008 pp-24-27) stated that the rationale behind mergers and acquisitions is based on the thought that two companies together can be more valuable and robust compared to two different companies. Moreover, mergers and acquisitions help in attaining cost efficiency by sharing operational and functional costs along with thriving to achieve greater market share and efficiency in a planned way (Harwood, 2006 pp- 24-35) Relevant Theories Mergers and acquisitions can be linked with various relevant theories. ...
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