Please critique this article by identifying methodology, gap and key findings.
Dikova, D., Sahib, P. R., & van Witteloostuijn, A. (2009). Cross-border acquisition abandonment and completion: The effect of institutional differences and organizational learning in the international business service industry, 1981-2001. Journal of International Business Studies, 41(2), 223-245.© BrainMass Inc. brainmass.com October 25, 2018, 8:31 am ad1c9bdddf
Please see the attached file for the tutorial.
1. Please pay attention to your university's suggested citation style. This citation style should also tell you how to format your final paper, e.g. cover paper, headings format, etc.
The researchers, Dikova, Sahib and van Witteloostuijn, set out to investigate a very specific period in the mergers and acquisitions (M&As) process specifically for cross-border acquisitions. In effect the researchers studied the impact of the acquiring and acquired companies' nationalities on the "likelihood that a cross-border acquisition deal will be completed, as well as the time taken for its completion after announcement" (Dikova, Sahib & van Witteloostuijn, 2010, p. 223).
Specifically, the authors tested their hypothesis on M&As in the international business service industry with about 2,389 cross-border acquisitions deals included in the study.
I agree with the authors as regards their claim that "pre-merger activities" (Dikova, Sahib & van Witteloostuijn, 2010, p. 223) significantly impact the success of the M&A. The researchers justified their focus on these pre-merger activities with the accompanying costs levied on the company which violates any of the covenants ...
The cross-border acquisition and abandonment are examined. The institutional differences and organizational learning in the international business service industry are discussed.
1) What is the net present value of the project?
2) a. What is the gain from merger? b. What is the cost of the cash offer? c. What is the NPV of the acquisition under the cash offer?
25. Project Evaluation.
The following table presents sales forecasts for Golden Gelt Giftware. The unit price is $40. The unit cost of the giftware is $25.
Year Unit Sales
It is expected that net working capital will amount to 20 percent of sales in the following year. For example, the store will need an initial (year-0) investment in working capital of .20 × 22,000 × $40 = $176,000. Plant and equipment necessary to establish the Giftware business will require an additional investment of $200,000. This investment will be depreciated using MACRS and a 3-year life. After 4 years, the equipment will have an economic and book value of zero. The firm's tax rate is 35 percent. What is the net present value of the project? The discount rate is 20 percent.
Merger Gains and Costs.
8. Merger Gains and Costs. Velcro Saddles is contemplating the acquisition of Pogo Ski Sticks, Inc. The values of the two companies as separate entities are $20 million and $10 million, respectively. Velcro Saddles estimates that by combining the two companies, it will reduce marketing and administrative costs by $500,000 per year in perpetuity. Velcro Saddles is willing to pay $14 million cash for Pogo. The opportunity cost of capital is 8 percent.
a. What is the gain from merger?
b. What is the cost of the cash offer?
c. What is the NPV of the acquisition under the cash offer?
Attached you will find the PDF documents to some practice study problems that I am still trying to grasp and understand. These are the ones that I did not know how to do. Your help is greatly appreciated.
Chapter 8: practice problem 25 on PDF document page 234
Chapter 21: practice problem 8 on PDF document page 595View Full Posting Details