Understanding Mergers and Acquisitions

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:

Mergers and Acquisitions (M&A) typically refers to a corporate fiscal and strategic set of strategies that deal with the purchasing, selling, and/or combining of different companies or pieces of companies that are able to help grow a company or experience rapid innovation with either creating another business entity or investing research and development from the ground up (Hennepopf, 2009). Modern organizations are so highly complex and competitive that the old paradigm improving efficiency and the bottom line improves, is no longer all it takes to be successful. Companies must continue to reinvent themselves, put Board egos aside and look at the marketplace, their expertise, and what they can do to retain market share. With technology changing so

The industry we have chosen is the department store-retail industry. Within this industry, we have chosen the department stores of JCPenney and Macy’s. We find this industry, as well as these two companies, interesting from a strategic perspective. JCPenney has recently undergone a massive strategic restructuring in regards to its pricing, brand offerings, and store layout, pushing it away from the typical department store strategy of discounts and coupons. Its new strategy has become much closer to Wal-Mart’s strategy of every day low prices. Macy’s, on the other hand, has restructured with a push from the economic

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.

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.

This paper will discuss the kroger company’s strategy and competitive advantage. It will also discuss competition and strategy from rival company Walmart. Research will show whether Kroger uses an offensive or defensive strategic approach to business practices. It will discuss mergers and acquisitions of The Kroger Company (Bethel University, 2017).

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

This goal of this analysis is to shadow some light on K-Mart and Target and with the help of extensive research. In this analysis we can find out what each company can do, where they lack and what has to be done in order to keep the company profitable and alive. Thus, we will try to look at the Target wholly and then it will identify a successful business strategy and thus show that the strategy has moved the Target into one of such leaders in the industry. When we will take a look at K-Mart and then we will move on the identification of a failed business strategy and then show that the strategy has been holding this company at the back. After that we will try to perform a cross- case analysis by contrasting and comparing

Industry Analysis In the retail industry there are many fierce competitors, who want to dominate the retail market, for our case study we will be analysing the Wal-Mart company. Wal-Mart competes in several retail categories such as Target in the general merchandise retailing, where “Target had 1681 domestic stores including 239 Super Targets and ranked 28th on the fortune 500 list. Target has gained the competitive advantage over Wal-Mart because it offers more upscale and fashionable merchandise than that of Wal-Mart.” We also have K mart who used to be a fore runner with Wal-Mart but due unforeseen events they declared bankruptcy and shut down many of its stores, but under new management they were able to re-open but now it operates as a subsidiary of Sears Holding and follows target in third place among discount retailers.

out why this merger came to fruition and the reasons it made strategic sense financially. Also, I evaluate

A merger is a strategy where two companies agree to combine. Mergers are popular among

In order to have a successful M&A many different steps are involved. Each step in the process is just as important as the next and cannot be over looked. Some of the broader area’s that require focus are; accounting, taxes, and legal. Within each of these categories are several sub categories that are important to focus on when attempting to complete a successful merger or acquisition. While every organization may have a different process for doing so, and place more importance on one than another would, all of the aspects listed are important. However, it is up to each individual organization to designate how important each one is.

According to Risberg (2013), the efficiency theory argues that mergers are organizational strategies that are implemented to achieve three types of synergies, namely financial synergy, operational synergy and managerial synergy. Generally, the acquirer firm will have considered the target’s capable assets and resources and presume that they can be beneficial to its own development. The synergy concept reinforces this idea when it comes to mergers. For instance, the synergy concept argues that mergers allow the combining of the efficient parts of the companies and the discarding of parts that are considered redundant. Johnson (2014) observes that synergy occurs in varying ways, for instance, when companies combine their different competitive advantages, potential tax benefit, or high manpower. Any factor that raises the market value of the merging firms is called a synergy. This means that the

It is evident that there has been an increase in merger activity over the past few decades around the world and according to Peacock and Bannock (1991) the lure of mergers to be a way of expansion and it can be represented in few main points that motivate the activity.

Mergers have become the way to go in the current climate of instability due to the recession. Since more and more companies are now showing the openness and eagerness towards mergers to enhance the business or to achieve stability, the issues associated with mergers are ever so under scrutiny than ever before.