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Merge or Run as a Separate Company.

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You are part of a company who has made the strategic decision to acquire another company. There are two possible implementation strategies for this decision:

A. Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.

What are the pros and cons of this implementation strategy?
How will you know if the strategy is working?

B. Operate the acquired company as a separate business entity. The result of this strategy will be two separate companies under one senior management "umbrella" (the senior management team that is responsible for running both companies).

What are the pros and cons of this implementation strategy?
How will you know if the strategy is working?

2-3 paragraphs with references

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Solution Summary

This posting discusses the dilemma between merging an acquired company or operating it separately. It also shows the pros and cons of each strategy.

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STEP 1

A. Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.

What are the pros and cons of this implementation strategy?
How will you know if the strategy is working?
The pros of this strategy are that there is a unity of command that can be exercised over the company. The brands are consolidated and their positioning strengthened. Third, the other company can leverage the finances of one company. Fourth, the company gains advantages from its size. Fifth, greater bargaining power with customers, suppliers and dealers.

The cons ...

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