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Ch4 p 2 - Record of Success or Failure A large percent of...

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Record of Success or Failure A large percent of international M&As fall short of their objectives and one- third are dissolved within a few months or years An international merger or acquisition can yield increased value and profits in a number of ways: 1.Enhances industry consolidation 2.Enables geographic expansion into neighboring regions 3.Enhances expansion into new markets 4.Acquires new technology or products or knowledge 5.Involves combining with one or more other firms in order to realize a synergy that will form a preeminent firm RECORD OF SUCCESS OR FAILURE Key Reasons why Cross-Border Alliances and M&As Fail: •Unrealistic expectations •Hastily constructed strategy and unskilled execution •Culture clashes between partners / organizations •Key talent is lost •Lack of trust among managers •Unexpectedly high costs associated with the transition and integration Due diligence •Firms must conduct thorough preliminary due diligence to assess carefully
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