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M&A and Strategic Outlook

Could a merger or acquisition impact FedEx's strategic outlook. Any pros and cons, i.e. possible synergies, cost saving, and morale issues.

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Yes, it is indeed true that a merger or acqusition will heavily impact Fedex's strategic outlook. Historically, Fedex has been involved in a number of acquisitions which has helped the company to grow and become one of the largest companies in the world in its business segment. These mergers and acquisitions have paved the way for Fedex to strengthen its position in various segments of supply chain management solutions arena and increase its market share in varous segments in this industry.

Some of the most important objectives and motivation of mergers or acquisitions is to obtain horizontal or vertical integration, achieve operating synergies, economies of scale, greater control over the market via consolidation, to lower down the costs of production or to enter new business segments within the same industry or related industry. For example, an automobile manufacturer acquires an auto ancilliary unit which supplies auto parts for its final products in order to lower down the cost of production and obtain vertical integration to common more control over the inputs and raw materials. Similarly, acquisition of another brand in the automobile industry is a strategic move to increase market share and possibly enter another business segment in the same industry.

All the above mentioned strategic reasons apply to Fedex as well in its quest for mergers and acquisitions and create a major impact on Fedex's strategic outlook. If we take a look at Fedex's major acquisitions in the past, we will find that all the ...

Solution Summary

Could a merger or acquisition impact FedEx's strategic outlook.