Download - FM-mergers and acquisition

8/14/2019 FM-mergers and acquisition

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Merge rs Acquisitionsand

business

combination
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Why Business Combination?Forms Of Business Combination
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business

combination

Mergers

Amalgamation

Acquisitions

Takeovers
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AI & IA TO MERGE IN APRIL

TATA LIKELY TO REVISE CORUS TAKEOVER OFFERAMTEK AUTO RENEW BID TO ACQUIRE UK COMPANYTATA GROUP IN RACE FOR DAEWOO ROMANIAGE SNAPS UP SMITHS AEROSPACE FOR $4.8 BILLION

HINDUJAS ENTER RACE FOR HUTCHS HTL STAKEIDBI BUYS 10% STAKE IN BAG FILMS RADIO UNITUS AIRWAYS RAISES BID FOR DELTA


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Merger

When two or more companies

combines into one company

may merge with existing co,

form new company

in India merger is called Amalgamation


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Merger

Merging Companiesare called

Amalgamating

Companies

New Company iscalled

AmalgamatedCompany


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Merger

MergerThroughAbsorption

MERGERTHROUGHCONSOLIDATION


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Merger

MergerThroughAbsorption

An Absorption is Combination oftwo or more companies into an

existing company

All companies except one losetheir identity


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Western UnionBank Merged

WithIDBI

New Bank Of

India MergedWith PNB

Bank Of NewYork Merged

With MellonFinancial


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Merger

MergerThroughConsolidation

A consolidation is a combination of two or moreCompanies into a new Company

All companies are dissolved to form a new Company


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Merger

MergerThroughConsolidation

HindustanComputers Ltd

HindustanInstruments

Ltd

Indian SoftwareCo .Ltd

IndianReprographic

Ltd HCL LTD


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Merge rs AcquisitionsandAcquisition

An Acquisition may be an act of acquiring

effective control by one company overassetsormanagement of another company withoutany combination of companies..

Companies may remain independent, separateBut there may be change in control ofCompanies..


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Merge rs AcquisitionsandAcquisition

Obtaining Control over management of a Company

MRTP ACT-at least 25% voting right of a Company

Investment of more than 10% share into a companyRequire approval of Shareholders & C Govt.


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Dabur Pharma to acquire Thai company

Aditya Birla Group to acquire Trinethra

Chinas largest Bank to take overIndonesian Bank


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Merge rs AcquisitionsandWE ARE LOOKING TO ACQUIRE

Pl. send proposals & contact details to [email protected]

HOSPITALSWe are leading business house with a reputed presence inIn health care sector in the country

We are likely to acquire medium to large sized hospitals inMetros, state capitals & tier 1 cities. They could be on outright purchase or long term lease. We are also open to

Joint Ventures


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Merge rs AcquisitionsandAcquisition & Takeover

When Acquisition is unfriendly orhostileIt may be called Takeover


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Merge rs AcquisitionsandMittal -Arcelor CaseMittal Steel bids for Arcelor-27.1.06Mittal after Arcelors Cash -2.2.06Mittal and Arcelor seek Support-6.2.06Arcelor investors favour mittal but want more-15.2

Arecelor offer sweet,hostality wanning-mittal 16.2Arecelor declared higher dividend than mittal-16.2Mittal Steel Launched formal take over-19.5Mittal raised bid before share holders meet-19.5

A,lor to merge with Russian Company Severstal 26.5Mittal Arcelor start talks -9.6Arecelor rejects mittal bid-12.6


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Merge rs AcquisitionsandMittal -Arcelor CaseMital woos Arcelor with 70% growth-13.6Mittal may hike offer-21.6Mittal Arcelor close to friendly deal-23.6Mittal wins over more shareholders23.6

Arcelor gives in to Mittal-26.6Did Mittal Yield too much-29.6Arcelor,s largest S,holder reject Severstal - 30.6Mittal Steel claims 92% shares of Arcelor -27.7

Mittal steel announces post merger plan-8.8Merged Arcelor-Mittal named Mike RepleyAs CEO OF US operations


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Merge rs AcquisitionsandTactics to Defend Takeover..Merger

DivestitureCrown Jewels

Poison PillGreenmailWhite KnightGolden parachutes
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HorizontalMerger

VerticalMerger

ConglomerateMerger

FORMS OF MERGER


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MergerObjectives

Faster GrowthImproving ProfitabilityManagerial EffectivenessGaining Market PowerLeadershipCost Reduction


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Are there any alternatives to Mergers or acquisitions?


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MergerAlternatives

Joint Venture

Strategic AllianceEliminating InefficientOperationsProductivity ImprovementHiring CapableManagers
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MOTIVES & BENEFITSOF

MERGERS

Limit CompetitionMarket PowerDiversificationGrowthEconomy of ScaleAccess to Foreign MarketResourcesDisplace existing Management

Circumvent Govt RegulationsAggressivenessDiversifying RiskProfitability
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MERGERS

Accelerated Growth

Expanding Existing MarketsEntering New MarketsExpand InternallyExpand Externally

Developing Operating FacilitiesPrice Paid for Merger


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MERGERS

Enhanced Profitability

Economies of ScaleOperating EconomiesSynergy


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MERGERS

Reduction in Tax Liability

Carry forward Losses

Tax on Share


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MERGERS

Financial Benefits

Eliminating Financial Constraints

Deploying Surplus Cash

Enhancing Debt Capacity

Lowering Financial Costs


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MERGERS

Increased Market Power

Market Share

Bargaining Power

Technological Advancement

Pricing

Limiting Competition
http://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.capitol-llc.com/images/mergers-acquisitions.jpg&imgrefurl=http://www.capitol-llc.com/merger-acquisitions.shtml&h=219&w=250&sz=12&hl=en&start=15&tbnid=aknrH0S_8Us3oM:&tbnh=97&tbnw=111&prev=/images%3Fq%3Dacquisitions%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.capitol-llc.com/images/mergers-acquisitions.jpg&imgrefurl=http://www.capitol-llc.com/merger-acquisitions.shtml&h=219&w=250&sz=12&hl=en&start=15&tbnid=aknrH0S_8Us3oM:&tbnh=97&tbnw=111&prev=/images%3Fq%3Dacquisitions%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DN


30/39


Steps inAnalysisOf

Mergers&Acquisitions

PlanningSearch &Screening

FinancialEvaluation

Mode ofMerger

Negotiation

Post

Merger
http://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.capitol-llc.com/images/mergers-acquisitions.jpg&imgrefurl=http://www.capitol-llc.com/merger-acquisitions.shtml&h=219&w=250&sz=12&hl=en&start=15&tbnid=aknrH0S_8Us3oM:&tbnh=97&tbnw=111&prev=/images%3Fq%3Dacquisitions%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.capitol-llc.com/images/mergers-acquisitions.jpg&imgrefurl=http://www.capitol-llc.com/merger-acquisitions.shtml&h=219&w=250&sz=12&hl=en&start=15&tbnid=aknrH0S_8Us3oM:&tbnh=97&tbnw=111&prev=/images%3Fq%3Dacquisitions%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DNhttp://images.google.co.in/imgres?imgurl=http://www.recoverychronicles.com/MediaPR/_images/eNewsletter/35/merger.jpg&imgrefurl=http://www.recoverychronicles.com/Article.asp%3FID%3D35%26ArticleID%3D400&h=331&w=310&sz=102&hl=en&start=13&tbnid=KoVRIQhozWy9oM:&tbnh=119&tbnw=111&prev=/images%3Fq%3Dmerger%26svnum%3D10%26hl%3Den%26lr%3D%26sa%3DN


31/39


Steps inAnalysisOf


Planning

Industry Data

Market GrowthCompetitionEase Of EntryCapital & LabourDegree of Regulation

Target Firm

Quality Of MgtMarket Share SizeCapital StructureProfitabilityProduction &MarketingCapabilities etc

Objective of AcquisitionsStrengths & WeaknessesBusiness Units-dropped

or Added
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32/39


Steps inAnalysisOf


Search &

Screening

Where to look for candidatesIs it too large or smallEngaged in related or unrelated ActivityExport oriented or Local

Amenable or not amenable to merger
http://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.fenews.com/fen38/fen38_images/magnifying-glass.jpg&imgrefurl=http://www.fenews.com/fen38/inside_black_box/black_box.html&h=203&w=382&sz=27&hl=en&start=5&tbnid=qreCekVJe6gVLM:&tbnh=65&tbnw=123&prev=/images%3Fq%3Dmagnifying%2Bglass%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.fenews.com/fen38/fen38_images/magnifying-glass.jpg&imgrefurl=http://www.fenews.com/fen38/inside_black_box/black_box.html&h=203&w=382&sz=27&hl=en&start=5&tbnid=qreCekVJe6gVLM:&tbnh=65&tbnw=123&prev=/images%3Fq%3Dmagnifying%2Bglass%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.fenews.com/fen38/fen38_images/magnifying-glass.jpg&imgrefurl=http://www.fenews.com/fen38/inside_black_box/black_box.html&h=203&w=382&sz=27&hl=en&start=5&tbnid=qreCekVJe6gVLM:&tbnh=65&tbnw=123&prev=/images%3Fq%3Dmagnifying%2Bglass%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnproducts.com/stoneusa/steps/steps.html&h=418&w=432&sz=33&hl=en&start=3&tbnid=rNLFzKmR1hAVnM:&tbnh=122&tbnw=126&prev=/images%3Fq%3Dsteps%26svnum%3D10%26hl%3Den%26lr%3Dhttp://images.google.co.in/imgres?imgurl=http://www.lawnproducts.com/stoneusa/steps/snapped%2520steps%25201.jpg&imgrefurl=http://www.lawnprod