mergers and acq

8/8/2019 Mergers and Acq.

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MERGERS AND

ACQUISITIONS!Under The Guidance

Of Ms.Deepika Rathi


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y Definition of Merger and Acquisition.

y

Distinction between Mergers and Acquisitions.y Types of Mergers.

y Merger Waves.

y Motives behind Merger of Companies.

yAdvantages of Merger and Acquisition.y Laws Regulating Mergers.


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y Legal procedures for bringing about merger ofcompanies.

y Emerging market see M&A volume at record highof $215bn.

y Top 10 acquisition by Indian co. worldwide yearwise data and graph.

y Top 11 latest Merges.


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DEFINITION OF MERGER

yA merger occurs when two or more companies combines and

the resulting firm maintains the identity of one of the firms.One or more companies may merge with an existingcompany or they may merge to form a new company.Usually the assets and liabilities of the smaller firms are

merged into those of larger firms. Merger may take twoforms-1. Merger through absorption2. Merger through consolidation.


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Merger through Absorption.Absorption is a combination of two or more companies

into an existing company. All companies except oneloose their identify in a merger through absorption.

Merger through Consolidation.

A consolidation is a combination if two or morecombines into a new company. In this form of mergerall companies are legally dissolved and a new entity iscreated.


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DEFINITIONOF ACQUISITION

May be defined as an act of oneenterprise of acquiring, directly orindirectly of shares, voting rights,assets or control over the management,of another enterprise


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Combination of two corporate entitieswhere the assets and liabilities of both arevested in a third entity, with the effect thatboth former entities lose their identities to

form a new entity.


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MERGERS ACQUISITIONS

y The case when two companies(often of same size) decide tomove forward as a single newcompany instead of operatingbusiness separately.

y The stocks of both thecompanies are surrendered,

while new stocks are issuedafresh

y The case when one companytakes over another andestablishes itself as the new

owner of the business.

y The buyer company swallowsthe business of the targetcompany, which ceases to exist.


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Horizontal Mergers.Vertical Mergers.

Conglomerate merger.A. Product-extension Merger.

B. Market-extension Merger.

C. Pure Conglomerate merger.


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The economic history has been divided intoMerger Waves basedon the merger activities in the business world as:

1889 1904 First Wave Horizontal mergers

1916 1929 Second Wave Vertical mergers

1965 1989 Third Wave Conglomerate mergers

1992 1998 Fourth Wave Congeneric mergers

2000 - Fifth Wave Cross-border mergers

Merger waves


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mergers and acq

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