Character Analysis: Sun Pharmaceutical Industries And Ranbaxy

Whether or not the merger acquisition is successful depends on (a) the net present value of the investment and (b) paper announcement of the merger. I mean once the merger is sealed, between three and eleven days, changes in the company’s value (the accurer and target) at the time of annoucement of the merger determines the acquisition financial success. The paper announcement returns is supported by Andrade Mitchell and Stafford (2011) after using the database of University of Chicago. Simulation analysis can also be used.

According to the researchers the increased value results from an opportunity to utilize a specialized resources which arises solely as a result of the merger (Jensens & Ruback, 1983; Bradle, Desai and Kim , 1983). For creating operational and financial synergies managers believe that two enterprises will be worth more if merged than if operates as two separate entities. Thus, the two companies, A and B:

It all started in the year 1983 when Mr. Dilip Sanghvi decided to walk the extra mile from being a distributor to one of the biggest players in pharmaceutical industry. He named his brainchild as ‘SUN PHARMA’.

Merging with another organization has downfalls of destroying wealth from the merger. Considering the buying price is important when merging, spending too much on the merger will impound the value after the merger. Some mergers do not create wealth so capital is lost through the merger. There is no guarantee of financial gain and every formula considered with focus, just as with an acquisition. The final decision dictated by the variables. One company merging with another company takes the debt and losses of those companies in the new formed company.

In this chapter, we first provide coverage of expansion through corporate takeovers and an overview of the consolidation process. Then we present the acquisition method of accounting for business combinations followed by limited coverage of the purchase method and pooling of interests provided in a separate sections.

(a) In a merger agreement, the assets and liabilities of the firm which is being acquired end up being absorbed by the buyers firm. A merger could be the most effective and efficient way to enter a new market without the need of creating

Mergers and acquisitions have become a growing trend for companies to inorganically grow a business within its particular industry. There are many goals that companies may be looking to achieve by doing this, but the main reason is to guarantee long-term and profitable growth for their business. Companies have to keep up with a rapidly increasing global market and increased competition. With the struggle for competitive advantage becoming stronger and stronger, it is almost essential to achieve these mergers. Through research I will attempt to dissect the best practices for achieving merger success.

A merger is a partial or total combination of two separate business firms and forming of a new one. There are predominantly two kinds of mergers: partial and complete. Partial merger usually involves the combination of joint ventures and inter-corporate stock purchases. Complete mergers are results in blending of identities and the creation of a single succeeding firm. (Hicks, 2012, p 491). Mergers in the healthcare sector, particularly horizontal hospital mergers wherein two or more hospitals merge into a single corporation, are increasing both in frequency and importance. (Gaughan, 2002). This paper is an attempt to study the impact of the merger of two competing healthcare organization and will also attempt to propose appropriate

Haspeslagh and Jemison (1987), argue that what determines the success of a acquisition is not the actual purchase itself, but the development of the acquisition strategy the supports. Unfortunately, many executives face the acquisitions as an end, not a means to achieve that end. According to this author, the acquisition is only one strategy business growth. There are others as internal growth, joint venture, partnership, franchise and strategic alliance. All should be evaluated by the company before implementing a business development strategy. A proper analysis of the acquisition goes beyond the study's own candidate company. It must include a contribution from the analysis of potential acquisition for the strategic development, as well as

Mergers and acquisition plays an important role in survival/vitalization of a corporation in today’s market. It continues to be a breakthrough strategy for improving innovation of a company’s product or services, market share, share price etc.

Mergers and acquisitions occur because executives from both the acquirer and target companies see the large amount of value that will result with a conjugation of each company’s assets. The acquisition will allow for the emergence of new identities and properties. Mergers and related acquisitions have occurred in a series of outbreaks. Recently, the pharmaceutical industry is seeing a rush of new mergers and acquisitions because of a combination of investor pressure and a narrowing window of opportunity. The reason for this current pattern is due to the fact that pharmaceutical companies and their associated board of directors believe that acquisitions are the clear way to grow revenues. The Merck Company’s acquisition of Medco as a pharmacy benefit manager are pursuing to increase their customer size and negotiating power, while developing new ways to serve customers. This acquisition will insert Merck within the trending consolidation of pharmaceutical benefit managers and drug suppliers, as this industry is becoming more than just an administrator and negotiator.

In March 2015, one of the biggest mergers in India’s history happened between Sun Pharma and Ranbaxy, two major pharmaceutical players in the field. The merger was forecasted to bring about more than $250 million USD in synergies in the third year . Moreover, both of these established names were complementary in many of their core competencies, especially in areas of efficiency and expertise. Sun Pharma is known to be a global specialty giant with capabilities in dealing with the complex and niche territories of medicine, whilst Ranbaxy has a stronger global footprint in the sector of manufacturing generics (Jhawar, 2015). In fact, this was a move that was made in line with strategic approaches within the firm as seen in Figure

Sun pharmaceutical industries limited was established by Dilip Sanghvi in 1983, headquartered in Mumbai. The company deals in pharmaceuticals and generic drugs Over 72% of Sun Pharma sales were from markets outside India, majorly in the US and was listed on the stock exchange in the year 1994. The company offers formulations in various therapeutic areas such as cardiology, psychiatry, neurology, gastroenterology and diabetology. Today Sun Pharma is the second largest and the most profitable pharmaceutical company in India, as well as the largest pharmaceutical company by market capitalisation on the Indian exchanges with a revenue generation in 2013-14 of 166.33 billion and an operating income of INR 71.6 billion. The net income in 2013-14

Sun Pharma, built up in 1983 by founder and CEO Dilip Shanghvi, makes claim to fame pharmaceuticals and APIs for use in Chronic treatment territories, for example, cardiology, psychiatry, neurology, gastroenterology, diabetes, and respiratory conditions, sold in 26 markets around the world. Sun Pharma appreciates a decent piece of the overall industry in pharmaceutical industry. Sun Pharma is work of four unique organizations that are Caraco Pharmaceutical Laboratories, Sun Pharmaceutical Industries Inc. (SPI), Sun Pharmaceutical (Bangladesh) and Alkaloida Chemical Company Exclusive Group Ltd. Sun Pharma makes claim to fame pharmaceuticals and dynamic pharmaceutical ingredients. The brands are recommended in incessant

Mergers and acquisitions have developed to be a widespread occurrence in modern era. A merger of the size like Adidas-Armani has repercussion for the labor force of these companies transversely to the world. Although the integration of units gives an immense arrangement of significance to monetary issues and the effects, there are still some issues are the most commonly ignored ones such as human resources, financial management, marketing, sales etc.. Ironically studies confirm that the majority of the mergers not succeed to convey the preferred results because of people associated concerns. The ambiguity resulted by badly handled management issues in mergers and acquisitions have been the foremost grounds for these collapses.