Consolidation Concerns : Pentagon 's Previous Policies And Their Implications For Competition

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.

Through tracing its development over the last few decades, this explores the modern day significance of the military industrial-complex. One such decade is the one following the end of the Cold War and the 1990-91 Persian Gulf War. It is during this time, 1997-2002 that U.S. plans requested $1.6 trillion dollars in military spending, despite having no major military rivals. Moreover, although US military spending has decreased in recent years, this is mainly the result of reduced fewer weapons purchased as opposed to the cancellation of weapons which further speaks to the impact of the military industrial-conflict. It is through the analysis of this and times and events like the war on terrorism, that the article comes to results such as, powerful MIC’s greater the risk of war, in addition to increasing the number of countries that hold access to technologically advanced

The meaning of the “term military-industrial complex” MIC is not quite clear for the most of military and civilians, even though they often read about in newspapers or hear from politicians. The term military-industrial complex did not exist in the past, it has appeared recently. The first use of this term was on January 17, 1961, when President Dwight D. Eisenhower addressed his farewell to the nation . After more than two decades on the launch of this term ,R. Buckminster Fuller revisited Eisenhower’s address in his book “A Grunch of Giants” to find out the extent of the influence of the owners of military industries, . Not only R. Buckminster Fuller who addressed what president Eisenhower said about the military-industrial complex , but

Fallows describes the impact of the military-industrial complex has to be detrimental in its economic and political influence just as Eisenhower warned in his speech.” The economic problem is that the federal government no longer has enough money to throw around without a plan. The political problem is the distortion of the process of public choice.” (Fallows, 2009, para 8). The military industrial complex encourages the option of war.

When companies combine/merge the whole objective is to gain new opportunities, gain market share, grow the business, to become more innovative and to improve product offerings, utilizing/sharing the existing resources and data. From the case

Many people would agree that the US defense industry needs to be reformed, but it seems like everyone has a different idea of how to best do it. This article provides a few well thought out, if ambitious, arguments for how to best reform the industry. These reforms seem easy and practical enough in theory, but successfully implementing the proposed reforms almost seems like an impossible task. These reforms would likely be met with resistance from people who may not realize that they are part of the problem. For a wide scale reform of the defense industry to work, everyone has to be more or less on the same page.

Mergers and other affiliations have different reasons for consolidation of positions and reducing the number of company employee's. There are businesses that want to merge in efforts to acquire, expand, improve, or even take over an industry to make a profit or cut cost in their organization. Consolidation of companies in the healthcare industry due to economic pressure can lead to reduction of jobs (Fallon & McConnell, n.d.). When mergers of the same industry combine it can become burdensome to retain all employee's from both companies and still make a profit. As a result, the merger may offer incentives such as voluntary termination incentive, relocation, or early retirement (Fallon & McConnell, n.d.).

business, company can get great profit and cut out additional operational expense. It is also easier to manage one company rather than two companies. Therefore, merging is the best solution.

A consolidation also results in lower competition inside the industry, which typically follows with higher, or at least not lower, prices and therefore higher profit.

More explicitly, the importance given to efficiencies as a defence to otherwise problematic mergers, the creation of the office of the chief economist, the guidelines regarding horizontal mergers, and more importantly the introduction of the new ’significant impediment of effective competition test’ (SIEC) are the main indicators of the shift in merger policy.

The creation of an integrated “European Military” along with a single market for defense could alleviate these shortcomings. The amalgamation of Europe’s militaries into one unified entity would necessitate military equipment standards to support cohesion. A truly connected military, designed to serve the whole of Europe, would more effectively provide global influence, just as integration has provided Europe more influence in the economic sphere. Additionally, a single market for defense products would promote competition and specialization, helping the European defense sector become more competitive in the global market as well. The adoption of a single market is likely to produce “winners” and “losers” as the states with the least competitive firms may struggle, but the net economic effect for Europe should be positive.

One major objective of mergers is to be able to reduce or fully eliminate the weaknesses that may exit in

The creation of an integrated “European Military” along with a single market for defense could alleviate these shortcomings. The amalgamation of Europe’s militaries into one unified entity would necessitate military equipment standards to support cohesion. A truly connected military, designed to serve the whole of Europe, would more effectively provide global influence, just as integration has provided Europe more influence in the economic sphere. Additionally, a single market for defense products would promote competition and specialization, helping the European defense sector become more competitive in the global market as well. The adoption of a single market is likely to produce “winners” and “losers” as the states with the least competitive firms may struggle, but the net economic effect for Europe should be positive.

Mergers have become a main aspect within the market economies, resulting in consequences that are potentially conflicting due to the stiff competition among different businesses (Richard & Yekini, 2014, p. 54). The conventional economic theory suggests that mergers are likely to raise the level of monopoly, hence leading to reduced competition and lower economic efficiency. The truth is that they can boost the effective level of competition within the monopolistic environment where size is an important factor. This means that in the case of markets that have a small number of large producers that are involved in competition, mergers can play a vital role in increasing the economic and financial power of smaller firms. This enables the small firms to compete favourably with the larger ones. Therefore, mergers are able to produce a countervailing force to fight the leading firms, putting more pressure on them, and making them look for other ways to constantly make improvements in their efficiency. This is similar to the way many small businesses behave as a result of competition in highly competitive markets. This paper elaborates the reasons that motivate firms to take over or merge with other firms and the effects of this, both to the employees and the firms involved (Su & Wells, 2014, p.46). This will be established by examination of specific recent acquisition or merger cases within EU member countries, putting into consideration a number of these aspects. The major driver

Overall, the proposed acquisitions yield the company a combined entity with much better performance in term of profitability such as: