week3 assignment

week3 assignment - Chen Hecheng 04-25-2010 259-1 Discuss...

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Chen Hecheng 04-25-2010 259-1 Discuss the reasons that companies embark on cross-border strategic alliances. What other motivations may prompt such alliances? There are five motives for cross-border alliances. 1. To avoid import barriers, licensing requirements and other protectionist legislation. 2. To share the costs and risks of the research and development of new products and processes. 3. To gain access to specific markets, such as the EU, where regulations favor domestic companies. 4. To reduce political risk while making inroads into a new market. 5. To gain rapid entry into a new or consolidating industry and to take advantage of synergies. 259-2 Why are there an increasing number of mergers with companies in different industries? Give some examples. What industry do you think will be the next for global consolidation? I think there are a lot of reasons. First of all, companies in different industries can still share the same resources in ways that create operating synergies. In addition, companies can capitalize on the intangible resources of its new partner. Also, mergers with companies in different industries can make a company bigger to make
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week3 assignment - Chen Hecheng 04-25-2010 259-1 Discuss...

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