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This is always luxurious to the suppliers, who in a bid to keep the market under consideration will offer discounts and sale their supplies to the merged organization at a cheaper rate (Cooper, 2006).
It is important to denote that the organization will not only benefit from discounted products, but it will also be able to easily access credit and finances from financial institutions cheaply. This is because of the increased size and capital base of the new organization. Another benefit of merger is that an organization is able to diversify its production and services. Take for instance, the merger between Pay Pal, and eBay. eBay is an online auctioneering firm, where as Pay Pal is an online payment system (Foster, 2010). On this basis, eBay is able to diversify the production of its services that is provision of online auction services, as well as providing services in online payments. Another important benefit of a merger is an increase in the market share of the new firm/ organization (Shenfelter and Hosken, 2010).
For instance, the failed merger between Daimler and Chrysler was to help the two organizations increase the share of their markets in the United States, and Germany as a whole. This is by taking advantage of the distribution channels that the two organizations commanded. Another benefit of a merger is that they result to improving the image of a company under consideration (Cooper, 2006). This is because mergers and acquisitions normally get huge media coverage, as a result, the companies can take advantage of this, to outline their policies, and also market their products. A company that experiences a merger will also manage to increase the value of its stock, and this is because of the perception that the new entity formed will be profitable (Foster, 2010).
For instance, the merger between US Airways, and the American Airlines was able to
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In the course of the competition both the companies tend to gain mutual benefits and advantages from each other. Apple tends to gain the research and development benefits of Samsung to enhance its product quality of its iPhones and iTabs. On the other hand, Samsung tends to gain the marketing potentials of Apple to thereby gain in required revenues pertaining to the sales of its components.
With this globalization, an increasing number of companies are looking forward to mergers and acquisition as an opportunity to expansion and growth. However, according to the statistics, about half the acquisitions become failure (Virani, n.d.). There are many reasons which lead the companies to be indulged into acquisition; the primary reason has surely been the value creation of the acquiring firm.
People today are engaged with a number of firms and businesses in their routine. The questions over the existence, advantages and disadvantages of firms have been answered by different researchers in different ways. The idea, however, lies in the understanding about the firms itself.
Orozco is assisted in the workings of the company by some nine other colleagues who are involved both with the design practices as well as with the business orientated aspects of the day to day running of the business. Bluarch, which is based in New York City, offers services in both architectural design and interior design and also caters for any master planning projects.
The Modigliani – Miller theorem or proposition is regarded as a key element in the development of today’s corporate finance. The bottom line of the Modigliani and Miller theorem is the proposition of irrelevance which argue that the value of a firm is not affected by the type of financial choices preferred by that firm.
Much attention has been devoted to the issue of the motivations behind the managerial pursuit of an acquisition policy and the resulting impact on firm value. For banking, in particular, the issue is of crucial importance. Bank mergers and acquisitions (M&A’s) come in waves, and today they are once again at the top of many corporate strategic agendas.
The history of development of various hotel corporations, as a rule, testifies, that the level of profit is a result of quality service. The main objective of hospitality operator is to maintain the level of service quality and develop strategies to improve their services.
The plant currently employs 70,000 at a rate of $100 per day. This is a variable cost of 70,000 * 100 = $7,000,000. There is an additional variable cost that includes materials and incidentals that equals $500,000. The total variable cost for the operation is $7,500,000.
The family, while a source of support initially remains in the background and it is the character of the owner that profoundly affects the growth of the company. The craving of an entrepreneur to be accepted as the business superior to a any other family member, and equally of the entrepreneur's family members to be his or her coequal seem to create tensions over who takes up different job roles (Rosenblatt et al.
According to the discussion there are several reasons that lead to the need for firms to spread their wings beyond the home base and seek markets abroad. The reasons why firms establish bases in foreign countries are myriad. It might be in search of new markets if the home ones are saturated or if competition has become too stiff.
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