Introduction
Company mergers do not have a good reputation of being successful. This well-known fact has made many employees of Global Parts Distributors (GPD) and Omega Environmental Technologies Company (Omega) nervous about the future of their companies. Both GPD and Omega have been very successful automotive air conditioning manufacturers and distributors. Global Parts Distributors, L.L.C. (GPD) started out as Auto Air of Macon in 1974 as an automotive A/C installation and repair shop. Over the years the business evolved, and today is one of the most knowledgeable and dependable sources for aftermarket A/C parts in the United States (“About us”, 2014). Omega Environmental Technologies Company was founded in 1989 in Dallas, Texas and is a leading U.S. distributor of aftermarket automotive, truck and off-road air conditioning products. Omega has grown its distribution to over 84 countries and the USA (“Company info”, 2014).
In late 2012 both GPD and Omega were purchased by River Associates, an investing group. Founded in 1989, River Associates is opportunistic as to industry and has invested in numerous manufacturers, high margin distributors, industrial service, business service and select non-faddish retail. The firm seeks to make investments in companies with $30-$150 million in revenue throughout the United States and Canada (Harris williams & co, 2012). River Associates decided to merge the two companies even though company mergers fail 74% of the time. Why will the merger of GPD and Omega be one of the successful 26%?
Literature Review
There are many articles, reports and studies about company mergers. All of these works explain company mergers’ successes and failures. This information can help decide whether a new...
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...environmental technologies with global parts distributors and santech industries. (2012, December 5). Retrieved from http://www.harriswilliams.com/news/harris-williams-co-advises-merger-omega- environmental-technologies-global-parts-distributors
Hromel, A. (2013). Reasons for Mergers and Their Impact on Companies. 27(1), 82-88
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Trivedi, J (2014). A Study on Pre and Post Performance Evaluation of Merger and Acquisition of Top Companies of BSE and NSE. SIES Journal of Management, 9(2), 3-15.
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Why mergers succeed. (2012). Retrieved from http://www.cbsnews.com/8301-505125_162- 57412985/why-mergers-succeed/
In the year of 2005, the companies eventually found a way to make it easier for the companies to combine without having any major issues or problems. Unfortunately, around the year of 20010 the merging com...
This article is concluding that the choice of leadership succession is not important in how the merged company fares thereafter, even in such an extreme case as a mergers of equals. Nonetheless, the high failure rate of mergers remains, and so research should shift attention to other salient factors such as cultural and operational integration (Cheng, 2012). This article is supporting iGate Patni because, instead focusing about the choice of leadership succession, IGate focused on the factors such as cultural and operational integration which is the reason for their successes in merging with Patni.
In the literature one finds a large number of explanations for the occurrence of mergers and acquisitions. Sometimes, these explana-tions are also applicable to related forms of interindustrial links such as joint ventures or strategic alliances. Therefore it is necessary to define the term merger and acquisition as it will be used throughout this paper.
Chang, S. Suk, D. Failed takeovers, methods of payment, and bidder returns, Financial Review. 33 (2), May 1998.
A merger is a partial or total combination of two separate business firms and forming of a new one. There are predominantly two kinds of mergers: partial and complete. Partial merger usually involves the combination of joint ventures and inter-corporate stock purchases. Complete mergers are results in blending of identities and the creation of a single succeeding firm. (Hicks, 2012, p 491). Mergers in the healthcare sector, particularly horizontal hospital mergers wherein two or more hospitals merge into a single corporation, are increasing both in frequency and importance. (Gaughan, 2002). This paper is an attempt to study the impact of the merger of two competing healthcare organization and will also attempt to propose appropriate clinical and managerial interventions.
Brenda, I must start by saying I am not in total agreement with the notion that mergers and acquisitions are fast and efficient ways to get into new markets. Casing point the current case of wellcome, no one could prove to me in any way that this merger was anything close to efficient. I would, however, agree that it can be a faster way to get into a new market and consolidate resources. Per (Hussinger, 2010), technology acquisitions can strengthen the firms’ technological competencies, on the one hand. A bundling of competencies can be important in order to stay competitive in fast-growing markets. Effective communication in my view can be one of the key ingredients to having a successful merger. It
The purpose of this paper is to attempt to recompile information about the merger of two corporations; one of many taking places i...
Conglomerate mergers result in joining of firms which compete in different product markets, and which are situated at different production stages of the same or similar products. That is to say, neither the products nor the inputs of these merging firms are the same. Conglomerate mergers result in significant advantages gained by the merging firms since they are the fastest means of entry into different activity fields in the shortest possible time span. Moreover, they reduce the financial risks by “not putting all the eggs in one basket” (Gaughan, 2007). There are three types of conglomerate mergers:
Mergers is when two firms or entities, often of about the same size, agree to become one single new entity or organization rather than remain separately owned and/or operated. This kind of action is often referred to as a ‘merger of equals’. Financially, the stocks of both companies are migrated into a new stock with the new name of the company issued. (CIPD, 2009)
To examine the impacts of a merger and determine if communication with employees could mitigate the expected negative effects of mergers and acquisition on them, a field experiment was conducted with the focus to provide a clearer picture of the effects over time of the merger and communication with employees.
In my opinion, the important components to keep for newly combined firms are legal compliances plan, high-quality marketing plans and the employee’s skills development
One can use SWOT analysis as a major tool to identify factors affecting the competitiveness and viability of each firm before the merger takes place. The intent is to provide the information base to support clear and focused decision making. Exhibit 1 provide...
According to Investopedia.com (2014), “[…] a merger is a deal to unite two existing companies into one new company […]”. There are 5 main types of merger: conglomerate, horizontal, market extension, product extension, and vertical. In a conglomerate merger, none of the companies to be united has anything in common. In a horizontal merger, the companies to be merged are in same industry, and the deal is part of a consolidation. In a market extension merger, the companies sell same products but compete in different markets. In a product extension merger, companies add together products that go well together. In a vertical merger, the companies make parts for a finished good combine. Among the mergers that I researched, the one that caught my eye the
Mergers usually take place when companies are struggling on their own, but find hope and comfort in uniting with another company. This unite is a great way to create new companies, combine revenues, establishing new policies, procedures, and objectives. It also opens up new doors, and allows new companies to expand in so many different aspects of their business. Part of the mergering phrase should include the planning process to assist with determining the objectives of the business’ long term investments goals. This could also open up the door for new products, new machinery, new plants, replacement of machinery, new locations, new projects, as well as the tangible and intangible things both companies already have.
Mergers and acquisitions immediately impact organizations with changes in ownership, in ideology, and eventually, in practice. There are multiple reasons, motives, economic forces and institutional factors that can, taken together or in isolation, influence corporate decisions to engage in mergers or acquisitions. The financial risks of merging with or acquiring an organization in another country and how those risks can be mitigated are important issues for corporations to conduct research on. This paper will examine the sensible and dubious reasons for mergers and acquisitions and the benefits and costs of the cash and stock transactions.