Corporation Restructuring

Corporation Restructuring - Corporate Corporate...

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1 Corporate Corporate Restructuring Restructuring Stony Brook College of Business BUS 330 V. Giardini
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2 ECONOMIC CLASSIFICATION OF MERGERS ECONOMIC CLASSIFICATION OF MERGERS Vertical Merger A firm acquires its suppliers or customers Horizontal Merger Between firms in the same kind of business usually as competitors Generally has the effect of reducing competition Conglomerate Merger Lines of business have nothing to do with one another THE ANTITRUST LAWS THE ANTITRUST LAWS The U.S. is committed to a competitive economy Mergers concentrate economic power, and can reduce competitiveness Antitrust laws can prohibit mergers Judgment by Justice Department
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3 THE REASONS BEHIND MERGERS THE REASONS BEHIND MERGERS Synergies Growth Internal growth vs. external Diversification To Reduce Risk Similar to portfolio diversification Counterargument Economies of Scale Guaranteed Sources and Markets Acquiring Assets Cheaply
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4 MERGER ANALYSIS AND THE MERGER ANALYSIS AND THE PRICE PREMIUM PRICE PREMIUM
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This note was uploaded on 02/15/2012 for the course GERM 200 taught by Professor Kuhmar during the Spring '10 term at SUNY Albany.

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Corporation Restructuring - Corporate Corporate...

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