Chapter 23 Mergers and other Forms of Corporate Restructuring 23-1
23-1 Chapter 23 Mergers and Other Forms of Corporate Restructuring
Mergers and Other Forms of Corporate Restructuring Sources of value Strategic Acquisitions Involving Common Stock Acquisitions and Capital Budgeting Closing the Deal 23-2
23-2 Mergers and Other Forms of Corporate Restructuring Sources of Value Strategic Acquisitions Involving Common Stock Acquisitions and Capital Budgeting Closing the Deal
Mergers and Other Forms of Corporate Restructuring Takeovers, Tender offers and Defenses Strategic Alliances Divestiture Ownership Restructuring Leveraged Buyouts 23-3
23-3 Mergers and Other Forms of Corporate Restructuring Takeovers, Tender Offers, and Defenses Strategic Alliances Divestiture Ownership Restructuring Leveraged Buyouts
Why Engage in Corporate Sales enhancement and operating economies* Improved management Information effect Wealth transfers Tax reasons Leverage gains Hubris hypothesis Managementfa personal agenda 23-4 Will be discussed in more detail in slides 23-5 and 23-6
23-4 Why Engage in Corporate Restructuring? Sales enhancement and operating economies* Improved management Information effect Wealth transfers Tax reasons Leverage gains Hubris hypothesis Management抯 personal agenda * Will be discussed in more detail in slides 23-5 and 23-6
Sales Enhancement and Operating Economias n Sales enhancement can occur because of market share gain, technological advancements to the product table, and filling a gap in the product line n Operating economies can be achieved because of the elimination of duplicate facilities or operations and personnel n Synergy -Economies realized in a merger where the performance of the combined firm exceeds that of its previously separate parts 23-5
23-5 Sales Enhancement and Operating Economies Sales enhancement can occur because of market share gain, technological advancements to the product table, and filling a gap in the product line. Operating economies can be achieved because of the elimination of duplicate facilities or operations and personnel. Synergy -- Economies realized in a merger where the performance of the combined firm exceeds that of its previously separate parts