Mindtap For Brigham/ehrhardt's Financial Management: Theory & Practice, 1 Term Printed Access Card (mindtap Course List)
Mindtap For Brigham/ehrhardt's Financial Management: Theory & Practice, 1 Term Printed Access Card (mindtap Course List)
16th Edition
ISBN: 9781337909655
Author: Eugene F. Brigham, Michael C. Ehrhardt
Publisher: Cengage Learning
Question
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Chapter 22, Problem 2Q

a.

Summary Introduction

To determine:

Significance of merger with regard to likelihood of governmental intervention

b.

Summary Introduction

To determine:

Significance of merger with regard to possibilities for operating synergy

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Students have asked these similar questions
Four economic classifications of mergers are (1) horizontal, (2) vertical, (3) conglomerate,and (4) congeneric. Explain the significance of these terms in merger analysis with regard to(a) the likelihood of governmental intervention and (b) possibilities for operating synergy.
“Reasons for merger that will result in wealth maximization are strategic benefits, market power, economics of scale, economies of vertical integration and taxation benefits”. Describe how any four out of the five factors mentioned may contribute to the success of a merger business exercise
Define synergy. Is synergy a valid rationale for mergers? Describe several situationsthat might produce synergistic gains.
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