chap15 -...

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Technology Ventures : From Idea to Opportunity Chapter 15: Summary How can entrepreneurs best manage expansion into new  geographic markets and product lines? A new venture may start as a purchase of an existing company by a  team of entrepreneurs. Most, if not all, acquisitions are justified on  the basis of an expected synergy, which is the increased  effectiveness of the combined firms. Summary Opportunity is rare, and a wise person will never let it go by him. Bayard Taylor
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Technology Ventures : From Idea to Opportunity Chapter 15: Acquisition and Synergy Acquisition : when one firm purchases another. Synergy : the increased effectiveness and achievement  produced as a result of the combined action of the united  firms. Syn = V N  - V
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Technology Ventures : From Idea to Opportunity Chapter 15: Table 15.1 The Five Different Types of Mergers and Acquisitions Type Overcapacity Reduction Geographic Extension (Roll Up) Product or Market Extension Technology Acquisition Industry Convergence Objective To reduce excess capacity and increase efficiencies To extend a company’s reach geographically and build economies of scale and scope To extend the product line or reach a new market segment To quickly add new technologies and capabilities To establish a position during the convergence of an industry or sector Example Daimler-Benz and Chrysler ----------------- Hewlett-Packard and Compaq Bank of America and Nations Bank ------------------- Waste Management and numerous local firms Tyco and Raychem ------------------ J.M. Smucker and Jif peanut butter Cisco Systems acquired 60 companies in 1980-2000 -------------------- Medtronic acquired
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chap15 -...

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