Merger, Acquisition, and International Strategies - Assignment Example

Mergers, Acquisition and International Strategies Introduction Mergers and Acquisitions mainly influence changes in ownership, ideology, and eventually practice. Several economic forces, motives, and institutional reasons may influence company decisions to engage in these mergers and acquisitions. Other important issues different effects of these mergers and acquisitions to both companies. Evaluating the Strategy that led to the Merger of a corporation that Merged with Another Company or Acquired by Another Company In 2011, AT&T Company merged with the T-Mobile Company making it the largest wireless company in the United States. This merger left their competitor company Verizon Wireless behind. There are different ways that the T-Mobile benefitted from this merger especially in relation to the reduction of their debts. Merging with AT&T saw T-Mobile acquire AT&T Company’s stock value. Through this merger, AT&T hopes to increase its networking, and coverage. In addition, AT&T focuses on expanding their deployment based on long-term evolution technology. In order for AT&T Company to continue running its business, the wireless industry remains vital, and as a result, AT&T requires introducing new strategies as well as manufacturing new devices, while developing new applications for their consumers. Study shows that T-Mobile struggled with their stocks going down, and, for this reason, they had to merge with AT&T, which favored the two companies. Earlier, T-Mobile dealt with basic services like voice mails, texts, free weekend offers, and other enticing services attractive to their customers. However, they lagged in terms of internet upgrading, and while their basic services seemed fabulous, they lagged in wireless data business. They lacked a good plan for their clients like affordable data, new devices, and wireless data. With all these technological changes, they saw a need for change considering their competitors like AT&T, Sprint, and Verizon’s success cases. Despite their struggle to acquire more customers through better services, T-Mobile could not compete with the 3G network. AT&T took the advantage and merged with this struggling company offering cheaper phones, plans, and no contract plans. This merger made them the largest wireless company in the United States. Publix Supermarket as a Corporation that is not involved in Mergers and Bi-Lo Supermarket as a Profitable candidate for Merger Publix Supermarket and its subsidiaries operate in retail foods supermarkets in many of the United States including South Carolina, Georgia, Tennessee, Florida, and Alabama. Some of these company’s products include bakery, general merchandise, dairy, seafood, and pharmacies among other products and services. This company has both private-label brands as well as nationally advertised products. Other unbranded products like meat and seafood are on their shelves too. The suppliers and the company distribution centers are responsible for product delivery to the supermarkets (markets.ft.com). Bi-Lo Company founded in 1963 currently deals with health, special and organic foods, and has at one time filed bankruptcy in March 2001. During this time, the company received a $100 million to help it pay the employee salaries, suppliers, and vendors’ dues. However, by 2010, the company emerged from its bankruptcy although under Lone Star Funds management. These struggles make Bi-Lo a good candidate for merger with the successful Publix Supermarket. The merger may please the customers considering the added advantages like use of coupons and discounts. In addition, the merger may leverage the quality of services offered to the consumers. In addition, Publix Supermarket will benefit from increased sales and revenues benefitting both companies. Evaluating Apple Company International organization’s Business-level Strategy and International Corporate-level Strategy and Improvement Recommendations International Business-level strategy involves applying local requirements to pursue the strategies in to other countries (Hitt et al. 2013). This strategy focuses on variations of competition in each country with the products meeting specific needs for local clients. Apple tries to localize its products as much as they can although their prices continue challenging some users. Apple Company’s International business-level strategy includes making products with China being their number one manufacturers. According to www.apple.com, this company has continued its innovations, and introduced the IPad and IPhone5 into the markets. Study shows that Apple Company has both unique and This company outsources its exclusive products all-selling globally although at a slightly higher price. Spare parts from Korea, while Chile manufactures this company’s products. Some of the major Apple’s market countries include United States, Asia, and Europe. Apple faces serious competitors like Google, Huawei, and Samsung among others. This company targets people with interest on advanced technologies, and research shows that it leads in mobile technology innovation. Fewer people afford this high-tech gadget in the third world countries mainly because of its high costs. As a result, this company may have to produce cheaper phones for these developing worlds including parts of Asia, and Africa among others. A study by Hitt et al. (2013) posits that International corporate-level strategy involves the scope of an international corporation operation through geographic and product diversification. Apple Inc. Company’s International corporate-level strategy focuses on first world markets for sales, and second world production due to cheap labor. In addition, Apple manufactures its products based on consumer demands with the aim of offering latest technology in the market. Another objective includes selling latest devices although at high prices, and, as a result limiting its clientele. Apple’s modern image remains attractive to their targeted clients. This strategy unlike the International domestic-strategy involves minor modifications to the products and services depending on the region, but it stresses on the gains in economies of scale through offering similar products in every market. As a result, the manufacturers of Apple produce different quality products for each market. Apple has two main methods of product purchase and they include online purchase and physical stores purchase. One of the methods that Apple can improve their international business-level strategy is through providing free applications for their consumers. A good example is the MobileMe application that synchronizes the emails, calendar, and contacts at $99 annual payment. Providing this application free may attract more customers considering it as a reward. This strategy may pull more customers, and hold the existing clients due to motivation. A Business-level Strategy and a Corporate-level Strategy that South-West airlines Company that does not operate internationally may apply The Southwest Airlines Company, which is 41 years old, does not operate internationally, and it is a low-cost popular domestic airline in the United States. This airline has an exemplary customer care service with reliable services despite the low prices. This Boeing 337 commenced its customer care services in 1971serving Dallas, San Antonio, and Houston in Texas. Currently, this airline remains Texas largest passenger airline, and serves 38 states and Columbia (southwest.investorroom.com). According to Hitt et al. (2013), in International business-level strategy, the skills and resources established locally frequently allow companies to pursue in markets located in other countries. As a result, Southwest Airlines may focus on expanding its operations outside the United States like the North America, and South America. This company should consider targeting the 2016 Olympics by flying people to these destinations at reasonable prices. The airline can establish new reasonable routes because this would enhance company growth. International corporate-level strategy according to Hitt et al. (2013) involves the scope of a company operation based on the geographic and product diversification. The company may adapt multi-domestic, global, or transnational approaches. The multi-domestic approach includes adapting products for each market, global approach includes having a single product for the entire market, and transnational approach includes combining both multi-domestic and global approach. Southwest Airline Company has the capability of major competitions among Delta Airlines, France airlines, and United Airlines. Through lower labor production, Southwest Airlines may cut the costs incurred during the international competition. In addition, the company should ensure maximum utilization of its services because this is the only way to thrive in this competitive industry. This strategy may involve introducing new services whether technological or others. The company can also provide special offers in their services like reduced costs on cargo, or price cuts. Low cost flights can attract a larger number of customers hence increased profits. Conclusion Mergers and acquisitions help both in business expansions and enhanced return on investments. In addition, they help in the economies of scale and a good example is the T-Mobile that merges with AT&T. The merger saw AT&T become the largest wireless company in the United States, while Y0Mobile enjoyed the enhanced stock value. Most organizations join mergers on realization of a falling market value and diminishing company profits. Apple is an example of an international company applying both international business-level strategies and international corporate-level strategies. This approach contributes highly to Apple’s success. On the other hand, Publix supermarket is a good example of a company without merger and Bi-Lo supermarket is a good candidate for merger. This proposal is subject to the several complications around Bi-Lo that led to its bankruptcy in 2009. Merger and acquisitions are good approaches in situations leading to bankruptcy because the falling company receives rescue from the mother company. References Apple Inc. Apple . Apple Inc., Retrieved on March 1, 2015 from: http://www.apple.com/environment/news/ Hitt, M. A., Ireland, R. D., & Hoskisson, R. E. (2013). Strategic management: Concepts and cases: Competiveness and globalization (10th ed.). Mason, OH: South-Western Cengage Learning Publix Super Market Inc. Market Data,. Retrieved on March 1, 2015 from: http://markets.ft.com/Research/Markets/Tearsheets/Business-profile?s=PUSH:QBB Southwest Investor Relations., Company profile. Retrieved on March 1, 2015 from: http://southwest.investorroom.com Read More