Grob Mergers

Mergers and acquisitions has become an important part of the American commerce, which communication plays an important role in reducing the negative impacts. While Schweiger agrees that failure to communicate with employees during a merger will increase employee uncertainty and anxiety, he highlights that previous researchers (Napier et al., 1989) did not measure uncertainty nor any of the supposed dysfunctional outcomes said to follow uncertainty.

The merger I choose to research was the acquisition of Pixar by Disney. The merger between Disney and Pixar was a very successful one. They worked together in the past and their contract was running out after the release of Cars. This was the perfect opportunity and sensible move for these two companies to merge. The merger would allow the companies to work together conveniently. This merger was very

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.

The grounds for any merger depend on the competitive nature of both firms. If one firm is highly competitive and tries to

Companies do not have the freedom to merge and acquire as they please do. All have to meet the requirements and essentially be approved by regulatory bodies. In the context of regulations, antitrust laws and security laws are commonly referred to by regulator to determine whether a merger or acquisition should be allowed or rejected. Antitrust laws prohibit mergers and acquisitions that impede competition. The point is very simple where antitrust is referred to as competition. The goal is to increase competition because more competition in economics means that consumers get more at a fairer or lower price. Anytime a regulator believes that a merger or acquisition will make an industry or market less competitive, the business transaction might

The main weakness of merging the two companies would be with the staff. There would be cultural changes, disengaged staff and moral decreases (Iveybusinessjournal.com, 2015). Reorganization would need to be done to

Sharing information and keeping the lines of communication open with the existing employees and new employees is going to be a vital requirement for this merger. Mergers tend to leave employees anxious which create increased stress and lower productivity rates among employees (Bhaskar, n.d.). An effective communication plan can help mitigate this problem and quickly return the company to full production when the merger has been completed. Starting communication lines early also help reduce the amount of speculation employees have. Even with before a merger deal is completed employees might get a sense of what is going on through a number of different channels. This can lead to

A strength from performing a merger is the ability to acquire a company’s unused debt. “Some firms simply do not exhaust their debt capacity. If a firm with unused debt capacity is acquired, the new management can then increase debt financing, and reap the tax benefits associated with the increased leverage” (Keown, 2005, pp. 23-4). Another strength is enabling Baderman Island to remove an ineffective management strategy or team. Baderman Island has the option to decide who stays with the merged company, and who is out the door. Often times, a weak management leading team is the problem the organization has not evaluated for its mediocre success. “The merger of two firms can result in an increase in market or monopoly power. Although this can result in increased wealth, it may also be illegal. The Clayton Act, as amended by the Celler-Kefauver Amendment of 1950, makes any merger illegal that results in a monopoly or substantially reduces competition. The Justice Department and the Federal Trade Commission monitor all mergers to ensure that they do not result in a reduction of competition” (Keown, 2005, pp. 23-4).

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

For example the AOL company spent 186.2 billion on Time Warner when they merged in 2002 which made it the biggest merger ever. This was an unsuccessful merger as AOL based its model on dial up modems but consumers were switching to broadband. So subscribers ended leaving AOL and within 2 years AOL had about $99 billion wiped off its value. In 2009 the companies were de merged The advantages of merging with a company is you get shared power over the market, and also you make profits from both companies so your money increases.

According to MIT Sloan Management Review, there are six steps that should be taken to properly rebuild a management team. The first includes Reducing Role Ambiguity. This is essentially individuals who leave the new company because of the uncertainty the future holds for them. To help this, the board should do its best to ensure the company will be fine to the new executive team, as well as quickly remove any individuals who doubt the new company will be a success. Having just a few individuals who doubt the potential of the merger could quickly ruin a whole team and bring moral down. The second step states “Due Diligence Around Talent Is a Dangerous Corner to Cut”. To solve this, the board needs to get to know all the managers on both sides of the merger and actually find out about their full talent potential. The third part states “Recognize Old Habits Die Hard – But Not All Should”. Each company before the merger had a certain way of doing things, and while some of those methods

Many organizations will either experience a merger or acquisition to try to absorb the costs during unstable market times. Mergers and acquisitions to employee’s usual mean staff reductions and major changes, especially for an acquisition which, is when another company purchases a company and becomes a new company. (McClure, 2016)

Post-merger integration work is difficult, political, and often driven by teams that still have day jobs. Budgets are undefined, executive leadership is not clear beyond the C-level, no plans exist, and no one has done it before. Companies are willing to spend money on due diligence ahead of signing the papers, but do not always follow through to ensure that targets are met. In many cases, integration team members are plucked from the “operate and maintain” staff, and either cannot see or do not share the strategic vision of the “design and build” dealmakers. Companies that thrive from mergers do eight things (at least) correctly: Have a Plan, Communicate, and Measure Results, Dedicate the Team, Automate, Plan for Turnover, Focus on Business

Mergers are a form of consolidation where two or three companies merge and the identity of only the largest company remain intact and the smaller companies losses their identity.

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.