Merger And Acquisitions From A Strategic Financial Perspective

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In recent times, merger and acquisition are considered as one of the important steps for strategic growth. A company can plan to merge or acquire another company if it thinks it is a good investment, or they will earn a sound investment from it. The primary goal of any company entering into merger or acquisition is to boost the shareholder wealth. From a financial perspective, merger is carried due to diversification. It is the process of reducing the risks through investment decisions. For example, many a times, a company is highly at risk since it has done enormous investment in one industry then it can intend to buy a business in another industry (Sky Plc, 1990). This is termed as acquisition and can be beneficial for the host country.…show more content…
It is carried by offering the stockholders of one company the securities in acquiring other company in exchange for surrender of their stock (Taylor, 1990). Alternatively, acquisition refers to buying of one company by other in order to access its full control. Analysis of the Client & Target Companies Sky PLC is a British Pan-European company which is engaged in the business of satellite broadcasting, on-demand internet streaming media, broadband and telephone Services Company. It is headquartered in London and operates globally in countries such as UK, Ireland, Germany, Asia, etc. In Europe, the company is considered as one of the premier media broadcasting companies. The company claims to offer best and broadest range of content. Sky can plan to acquire, merge or form a strategic alliance with three companies depending upon their strategies, financials, and cultures. The companies chosen for this purpose are O2, TalkTalkandNetgear. O2 or Telefonica UK is a telecommunication and internet providing company based in UK. O2 is owned by Telefonica and is considered largest telecom provider in UK after EE Limited. O2 Plc has already been purchased by a Spanish telecommunications company Telefonica for $18 million. Alternatively, TalkTalkTelecom PLC is a UK based company engaged in the business of pay-television, internet access, telecommunications and mobile networks. The company deals with businesses as well as
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