1.0 Introduction 1.1 Merger and Acquisition Often, consolidation of corporation happened when two corporations within one industry join together. It means that one corporation that is less dominant absorbed by corporation that is more dominant. In another words, corporation with more dominant retain its identity while the other corporation has to abandon its own identity. Merger is combining two corporation to form a new company while acquisition is buy over one company and do not create a new company. 1.2 Downsizing As noted by Robbins & Pearce (1992), downsizing is a reasonable option for business grow strategic through reducing the scale and scope of a business so as to improve its financial performance. Corporation practices through shedding staffs that are less productivity in order to reduce operating cost and improve efficiency. By doing so, corporation will be more profitable and efficiency. 2.0 Advantages 2.1 Cost efficiency The most significant beneficial for corporation when come together by merger and acquisition is cost efficiency. This due to two corporations which form a newly company that have a higher purchasing power to reach for a bigger market. In fact, after merger and acquisition take place, the value of shareholder for the newly formed corporation will greater than the sum of shareholder values of a single corporation. Hence, corporation benefits for the cost cutting as the volume of production increases that result in the cost of production per unit being reduced. This eventually enhance the raise economic of scale by producing a product with a lower cost and a better way. Other than that, merger and acquisition lead to a business expansion that contribute an organic growth for a corporation as one corpora... ... middle of paper ... ...oyees find jobs. HR department should spread positive thinking to all employees by instill confidence that this short term changes will ultimately benefit in the future. In addition, remain contact with laid off employees because they might be rehire after business improved. Next, put some efforts to solve their worry and empathize with them. 5.0 Conclusion Human resource department is the core to determine a success of a corporation. A success of a corporation come from the contribution by the employees anticipate, adapt and respond to the management change. HR department that can well handle human interact problem such as culture change, morale, and relationship between employees will ultimately enhance potential success for the corporation. Last by not least, corporation goals can be easily achieve by keeping a proper communication that involving all employees.
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
It is proper to present a business definition of merger as it found on legal reference with the ultimate goal in the pursuing of an explanation on which this paper intents to present. A merger in accordance with the textbook is legally defined as a contractual and statuary process in which the (surviving corporation) acquires all the assets and liabilities of another corporation (the merged corporation). The definition go even farther to involve and clarify about what happen to shares by explaining the following; “the shareholders of the merged corporation either are paid for their share or receive the shares of the surviving corporation”. But in simple terms is my attempt to define as the product or birth of a corporation on which typically extends its operation by combining with another corporation. So from two on existence corporations in the process it gets absorbed into becomes one entity. The legal definition also implied more than meet the eye. The terms contractual and statuary, it implied a process on which contracts and statuary measures emerge as measures to regulate, standardized, governing or simply at times may complicate whole process. These terms provide an explicit umbrella and it becomes as part of the agreement formulating or promoting a case for contracts to be precedent, enforced or regulated in a now or in the future under a court of law under the Contract Business Law Statue of Practice. As for what happens to the shares of the involved corporations no more explanation is needed as the already actions mentioned clearly stated of the expectations of a merge’s share involvement.
After, a lot of extensive research, I found the Human Resources department is the core of a company. Human Resource department has implement policies and procedure to the employees on regular bases. The Human Resource department is responsible employee training on new laws. Also, Human Resources department has to be aware of new laws on continuous bases. I am confident about my major choice, and I will excel in my new career as a Human Resources Director.
The Human Resources department is dedicated to hire and build an excellent team with a great teamwork and leadership. As one of the most important strategies of the business is the innovation of their products, it is needed people who can add value to the company through its diversity, innovation and entrepreneurial spirit, in a competitive and fun environment.
Synergy is a commonly used word to explain why mergers and takeover occur; it means that combining the businesses will produce one enterprise that is more powerful and efficient. Synergies are expected when mergers occur due to the ability to take advantage of several economies of scale, such as distribution and production. However many firms under-estimate the effects of diseconomies of scale that two large business merging can bring. A furthe... ... middle of paper ... ...
In addition to the pro-competitive economic effect some firms also experience what is known as a post-merger which is basically an incentive for a firm to raise downstream competitor costs by raising upstream market costs. Hence the increased price pressures the previously established downstream prices which cause conflict.
A consolidation occurs when both the companies lose their identity and a new company is created to consolidate the two entities. The two companies become a completely new corporation (the successor corporation) and cease to exist as before. The successor corporation acquires all of the acquired companies’ share. Consolidation Situation: This merger happens generally with both the companies being of the same size. Example: U.S. Airways + AMR
A merger may lead to job losses. If the job losses lead to greater efficiency then the economy will benefit in the long run, and if firms get to big, they may suffer from diseconomies of scale. Diseconomies of scale come about when a business or organization becomes so big, or so inefficient, that the cost-per-unit of its products and services starts to rise. A business can only grow so much before the benefits of growth begin to create additional costs and resources, because any additional output becomes more expensive. Complexities take over and bureaucracies dominate, leading to more
In order to achieve this, business must think about how many workers they should hire. By doing so, they are making sure that they are not spending all their money on their workers. Another aspect that business consider is whether or not they should take part in mergers. Mergers include, horizontal and vertical mergers. Horizontal mergers, deal with merging with another company that produces the same good and at the same process as you. This is a great for business, that are trying to save money by letting go of their worker. On the other hand, vertical mergers deal with merging with another company that produces the same product as you but at a different process. This is great for business that are trying to save money on manufacturing and paying for less labor. Not only do mergers, allow business to better achieve their goal by hiring less labor it also allows them to save money on advertising. There are many aspects business must take in consideration in order to produce the most money
...within the organization, HR is able to provide decision-makers with valuable information and direction relating to managing human assets. HR can develop, communicate and implement strategy, evaluate data and create success. Done properly, HR has the potential to create a fulfilling environment for employees and provide valuable direction and data for decision-making so the organization’s objectives are met.
Individuals who are in charge of handling and maintaining the human resources of an organization work in a human resource department. Human resource departments started making its way into organizations in succession to the human relations era. Implementing HR functions was sought after when organizations realized that workers are more productive when managers make them satisfied. Now in nearly every company an HR department is a necessity to help workers become productive and feel like they belong. However, within every system there is a flaw. Human
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.
Not much to explain, for a successful merger or acquisition is the purchase price should be less than the current value of the operation.
When entrepreneurs plan their business future they will consider how they can increase their business size or profit in a short period. Entrepreneurs may consider growing their business or company by using a merger or an acquisition. These methods can be a speed up tool and a short cut to enlarge their business. (Burns, 2011) Also they can reduce competition, make it easier for entrepreneurs to think about the market and product development and risk reduction. Furthermore, some lesser – known companies can improve their firm’s image and market power by using merger and acquisition with larger firms. However, there may be risks associated with merger and acquisition related to lack of finance and time. (Burns, 2011) This essay will discuss more deeply the advantages and disadvantages of using mergers and acquisitions, showing how it can affect firms and market with the case study.
As an organisation grows and expands, the human resource department. will know that the organisation needs to recruit more staff and they plan carefully and carefully. Recruiting staff in an organisation is very expensive. and costly, so the human resource function helps the organisation to.