Advantages Of Mergers And Acquisitions

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According to Brunsman (1998), Berman (2007), Arrow (1969), there are few main points that can be highlighted about Mergers and Acquisitions:
• A Merger and an Acquisition are two different processes. The results can be similar in the end but the the ways the both processes work are different;
• Mergers or acquisitions are not always successful, sometimes they fail;
• Hostile vs. Friendly - An acquisition could be labeled “hostile” or “friendly.” This just refers to whether acquired shareholders of the company are on board with the transaction or not. Obviously, if they welcome, the transaction is friendly and if they oppose the transaction, it is considered hostile. It is important to remember though that if an acquisition labeled as a hostile, it doesn’t necessarily mean that it will be bad for the future of the company being acquired.
The following can be major benefits of mergers and acquisitions (Bertkovitch, 1993):
• Increased value is generated for
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For example, Microsoft’s acquisition of Skype is a product acquisition. Then, some companies can be acquired for non-saleable assets. For instance, the asset can be anything, even simply a customer database or a media property. Another advantage that can be taken from going into acquisition is acquiring a new talent. Google is very famous for doing such kinds of acquisitions. This company by buying businesses is taking the most important from each organization. For instance, engineers or IT department, and afterward, destroy the parts of the bought company that they don’t need. Companies go through mergers and acquisitions for the target goal of improved financial performance for shareholders. Profit is the main aim of almost every organization, so at the end of the day, more money is always an objective and advantage from merger and acquisition
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