Merger/Acquisition
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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.
1. What are the pros and cons of this implementation strategy?
2. 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).
1. What are the pros and cons of this implementation strategy?
2. How will you know if the strategy is working?
Your work MUST include a reference list. All research should be cited in the body of the paper
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Solution Summary
Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.
1. What are the pros and cons of this implementation strategy?
2. How will you know if the strategy is working?
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A. Merge the acquired company into your company. The result of this strategy will be one company containing the elements of both companies.
1. What are the pros and cons of this implementation strategy?
The major pros of this strategy will be attainment of synergies due to combined resources, strengths and assets of the company. If the merger is successful, the merged entity will be attain significant synergies such as reduction in operational costs due to economies of scale, enhanced bargaining power among suppliers due to increased purchase volume, complementary strengths in terms of assets, experience and manpower which would further lead to reduction in costs.
The major disadvantage that could arise due to merger is the fact that it can become a failure if the merged ...
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