Creating value from mergers and acquisitions: the challenges ; an integrated and international perspective
Gespeichert in:
| 1. Verfasser: | |
|---|---|
| Format: | Buch |
| Sprache: | English |
| Veröffentlicht: |
Harlow
Pearson Education [u.a.]
2003
|
| Ausgabe: | 1. publ. |
| Schlagworte: | |
| Online-Zugang: | Inhaltsverzeichnis |
| Beschreibung: | XXI, 593 S. graph. Darst. |
| ISBN: | 0201721503 |
Internformat
MARC
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Datensatz im Suchindex
| _version_ | 1804130017047740416 |
|---|---|
| adam_text | Contents
Preface xvi
Publisher s acknowledgements xix
1 Introduction 1
Do mergers and acquisitions add or destroy shareholder value? 1
The five stage (5 S) model 3
Stage 1: How good is the corporate strategy development process? 4
Stage 2: How well does the company organize for acquisitions? 5
Stage 3: What are the pitfalls in deal structuring and negotiation? 6
Stage 4: Don t count your chickens yet! Post acquisition integration 7
Stage 5: How did the merger go? Post acquisition audit and
organizational learning 8
Objectives of the book 9
Outline of the book 9
Notes and references 10
I Part 1 Historic, conceptual and performance overview of
mergers and acquisitions
2 Historical overview of mergers and acquisitions activity 13
Objectives 13
Introduction 13
The wave pattern of takeovers in the US 14
Takeover activity in the European Union 19
Historical overview of takeover activity in the UK 23
Environmental analysis of merger waves 27
Impact of industry changes on M A activity 28
Strategic implications of industry clustering of M A 31
Case Study: Takeover activity in the insurance industry 32
Overview and implications for practice 33
Review questions 34
Further reading 34
Notes and references 34
3 Alternative perspectives on mergers 37
Objectives 37
Introduction 37
The economic perspective on mergers 38
Industry analysis of competition 42
Game theory and competitive moves 43
Strategy perspective on mergers 47
Finance theory perspective on mergers 52
Managerial perspective on mergers 57
Organizational perspective on mergers 57
Summary of the multiple perspectives on mergers 58
Case Study: Increasing buyer power: Next time you go shopping buy
a supermarket 59
Overview and implications for practice 60
Review questions 60
Further reading 61
Notes and references 61
4 Are acquisitions successful? 63
Objectives 63
Introduction 63
Defining success of mergers and acquisitions 64
Measuring the impact of acquisitions on shareholder returns 65
Review of stock market assessment of acquisition performance 68
Results of empirical studies of merger impact on stock returns 71
Assessing the operating performance of acquirers 76
Comparative post merger performance of alternative corporate strategies 83
Post merger performance and M A deal characteristics 84
Mergers and managers 84
Overview and implications for practice 86
Review questions 87
Further reading 88
Notes and references 88
Appendix 4.1: Abnormal returns methodology to study the impact of
mergers on shareholder value 90
Appendix 4.2: Studies cited in Tables 4.1 to 4.7 93
Part 2 Corporate strategy and organizing for acquisitions
5 Sources and limits of value creation in horizontal mergers 97
Objectives 97
Introduction 97
Motivations for horizontal mergers in mature industries 98
Revenue enhancement through mergers 100
Cost savings as a source of value creation in acquisitions 105
New growth opportunities as a source of value 112
Resource based view (RBV) of acquisitions and value creation 114
Evidence of lack of sustainable competitive advantage 118
Case Study: A holiday romance that ends in a bikini war 119
Overview and implications for practice 120
Review questions
1 ?1
Further reading £
Notes and references
Contents
6 Sources and limits of value creation in consolidating
fragmented industries 124
Objectives 124
Introduction 124
Characteristics of fragmented industries 125
Value creation logic of consolidation 127
Financial versus strategic buyers 130
Limits of value creation in consolidation plays 131
Performance of private equity firms 134
Case Study: K lll, the leveraged build up 135
Overview and implications for practice 136
Review questions 137
Further reading 137
Notes and references 137
7 Sources and limits of value creation in vertical mergers 139
Objectives 139
Introduction 139
Vertical integration 140
Benefits and costs of buying in markets 142
Benefits and costs of long term contracts 143
Benefits and costs of vertical integration 147
Vertical mergers and value creation 149
Downscoping and disintegration 150
Mergers that blur industry boundaries 152
Case Study: Hospital, heal thyself 156
Overview and implications for practice 161
Review questions 162
Further reading 163
Notes and references 163
8 Sources and limits of value creation in conglomerate
acquisitions 164
Objectives 164
Introduction 164
Pattern of conglomeration in different countries 165
Why do firms diversify? 168
Resource based view of conglomerate acquisition 171
Finance theory on conglomerate diversification 173
Managerial perspective of conglomerate diversification 174
Organizational perspective of conglomerate diversification 175
Summary of alternative perspectives 176
Review of empirical evidence on the value of conglomerate diversification 177
Valuation of conglomerates in other countries 181
Evidence on operating performance 183
Is the internal capital market efficient? 184
Case Study: Sears, Roebuck Co. diversify and then divest 188
Overview and implications for practice 190
ix
Review questions 190
Further reading 191
Notes and references 191
9 Cross border acquisitions 194
Objectives 194
Introduction 194
Alternative overseas expansion strategies 194
Recent trends in cross border acquisitions 195
Factors influencing cross border mergers 197
Why do corporations undertake cross border acquisitions? 200
Barriers to cross border takeovers 204
Empirical and survey evidence on CBA performance 209
Case Study: Cross border acquisitions bring power to companies 212
Overview and implications for practice 213
Review questions 214
Further reading 214
Notes and references 214
10 Strategic alliances as an alternative to mergers
and acquisitions 217
Objectives 217
Introduction 217
Economic logic of strategic alliances 218
Types of strategic alliances 218
Equity and non equity joint ventures 220
International joint ventures 221
Model of joint venture 224
Structuring a joint venture 227
Regulatory issues in joint ventures 230
Performance evaluation of joint ventures 231
Critical success factors in strategic alliances 233
Choosing between an acquisition and an alliance 234
Case Study: General Motors (GM) and Ford drive on different roads
to same town 235
Overview and implications for practice 236
Review questions 237
Further reading 237
Notes and references 237
11 Corporate refocusing 239
Objectives 239
Introduction 239
Rationale for corporate divestitures 240
Corporate sell offs 242
Corporate spinoffs 247
Equity carve outs 256
The downside of downsizing 259
Tracking stock 260
Contents
Overview of the three divestiture methods 261
Case Study: Marriott s bondholders taken for a spin (or for a ride?) 262
Overview and implications for practice 263
Review questions 264
Further reading 264
Notes and references 264
12 Leveraged buyouts 267
Objectives 267
Introduction 267
Leveraged buyout 268
Overview of the LBO markets in the US and Europe 271
Organizing the buyout and role of the LBO sponsor 280
Raising debt capital 282
Junk bonds 284
Managerial motivations for an MBO 292
LBO as a superior business organization 294
Value creation performance of LBOs 296
Current state of the LBO market in the US and Europe 301
Case Study: The tale of two stores: Safeway and Kroger 302
Overview and implications for practice 304
Review questions 304
Further reading 305
Wofes and references 305
13 Organizing for acquisitions 308
Objectives 308
Introduction 308
Acquisition decision making process 309
Managing acquisition decision making 312
Managing the deal making 322
Developing deal negotiation capabilities 323
Survey evidence on the acquisition process 324
Case Study: How Beecham approached its merger with SmithKline Beckman 325
Overview and implications for practice 327
Review questions 328
Further reading 328
Notes and references 328
| Part 3 Deal structuring and negotiation
14 Target valuation 333
Objectives 333
Introduction 333
Sources of value in acquisitions 334
Traditional valuation models 335
Estimating target value using the PER model 338
xi
Example of valuation using the PER model 340
Asset based valuation 344
Valuation using other multiples 345
Discounted cash flow model 345
Impact of tax on target valuation 351
Real options framework for valuing targets 352
Valuation of real options 355
Case Study: They also lose who only stand and wait when option
value is eroded by competition 357
Overview and implications for practice 358
Review questions 359
Further reading 359
Notes and references 359
15 Accounting for mergers and acquisitions 361
Objectives 361
Introduction 361
Types of business combination 362
Accounting for business combination in the UK 362
Accounting for goodwill 366
Accounting rules in the US 368
Accounting for business combinations in continental Europe 370
International Accounting Standards Board (IASB) proposal 371
Incentives to choose pooling over purchase 371
Overview and implications for practice 374
Review questions 374
Further reading 375
Notes and references 375
16 Paying for the acquisition 377
Objectives 377
Introduction 377
Methods of payment for acquisitions 378
Tax aspects of acquisition financing 383
Impact of bidder s financial strategy 385
Earnings dilution in a share exchange 386
Choosing purchase price and exchange ratio to avoid earnings dilution 389
Valuation risk and payment currency 391
Equity derivatives and risk management in equity offers 392
Financing a cash offer 397
Leveraged cash financing 398
Deferred consideration financing 401
Factors determining financing method choice 404
Empirical evidence on the impact of payment method on financial performance 406
Case Study: Ride a jumbo loan to fight a hostile bid 408
Overview and implications for practice 409
Review questions 409
Further reading 410
Notes and references 410
Contents
17 Antitrust regulation 413
Objectives 413
Introduction 413
The UK antitrust regime 414
Antitrust regulation in the European Union 420
Antitrust regulation in the US 428
Antitrust regulation in continental Europe 430
Regulatory risk to M A deals 432
Multiple jurisdictions and their impact on takeover deals 433
Case Study: A princess, two suitors and four regulators 434
Overview and implications for practice 435
Review questions 435
Further reading 436
Notes and references 436
18 Regulating takeover bids 477
Objectives 477
Introduction 477
The importance of regulating the bid process 477
Takeover regulation in the UK 438
European Takeover Directive 449
Takeover regulation in the US 453
Regulation of takeover bids in continental Europe 453
Takeover regulation and takeover activity 456
Case Study: UK Takeover Panel doesn t buy the big MAC 457
Overview and implications for practice 458
Review questions 459
Further reading 460
Notes and references 460
19 Advisers in takeovers 461
Objectives 461
Introduction 461
Role of advisers in acquisitions 462
Investment banks and conflicts of interest 466
Compensation terms for investment bankers 468
Investment banks financial support role 470
Lawyers 472
Accountants 474
Other advisers 474
Public and investor relations 475
Recent trends in advisers rales 475
Empirical evidence on the impact of investment bankers on shareholder
wealth 476
Survey evidence on advisers role 477
Overview and implications for practice 477
Review questions 478
Further reading 478
Notes and references 478
yiii
20 Bid strategies and tactics 480
Objectives 480
Introduction 480
Bid strategies 480
Toehold, bid premium and bid outcome 483
Bid tactics 483
Developing a negotiation strategy 484
Negotiating a friendly bid 485
Risk reduction during negotiation 488
Hostile bid tactics 490
Empirical evidence on bid strategies 494
Bid strategies and tactics in the US 496
Shareholder wealth effects of hostile and friendly acquisitions 498
Bid strategies and tactics in Continental Europe 500
Case Study: Want me to play? Then pay 502
Overview and implications for practice 503
Review questions 504
Further reading 504
Notes and references 504
21 Defences against takeovers 506
Objectives 506
Introduction 506
Bid resistance motives 506
Bid defence strategies 507
Impact of defensive strategies 511
Cost of defence 512
Takeover defences outside the UK 513
Takeover defences in the US 513
Takeover defences in Continental Europe 516
Case Study: Menage a trois: French tycoons brawl over glamorous
Italian in Amsterdam 520
Overview and implications for practice 523
Review questions 523
Further reading 524
Notes and references 524
IPart 4 Post acquisition integration and organizational
learning
22 Organizational and human aspects of post acquisition
integration 527
Objectives 527
Introduction 527
A post acquisition integration model 528
Political and cultural perspectives of integration 530
Change management perspective of post acquisition integration 535
Contents
Human resource management issues during integration 537
Problems in integration 539
Stages in the integration process 541
Project management approach to integration 542
What do managers think about acquisition integration and performance?
Survey evidence 544
Survey evidence on acquisitions and the human factor 547
Critical success factors 548
Case Study: GE Capital turns a wheel of fortune and comes up a winner! 550
Overview and implications for practice 553
Review questions 553
Further reading 554
Notes and references 554
23 Post acquisition audit and organizational learning 557
Objectives 557
Introduction 557
Do acquirers assess acquisition performance? 558
What are the performance metrics? 559
Organizational learning perspectives 561
Acquisition making as a core competency 569
Case Study: Learning from past acquisitions 569
Overview and implications for practice 570
Review questions 571
Further reading 572
Notes and references 572
24 Meeting the challenges of mergers and acquisitions 574
Objectives 574
Introduction 574
Importance of the five stage model 575
The foresight and hindsight loops 576
Challenges in competitive strategy planning 578
Challenges in organizing for acquisitions 580
Challenges in deal structuring and negotiation 581
Challenges in post acquisition integration 582
Challenges in post acquisition audit and organizational learning 583
Index 586
xv
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| spelling | Sudarsanam, Sudi Verfasser aut Creating value from mergers and acquisitions the challenges ; an integrated and international perspective Sudi Sudarsanam 1. publ. Harlow Pearson Education [u.a.] 2003 XXI, 593 S. graph. Darst. txt rdacontent n rdamedia nc rdacarrier Mergers and Acquisitions (DE-588)4205916-1 gnd rswk-swf Mergers and Acquisitions (DE-588)4205916-1 s DE-604 HBZ Datenaustausch application/pdf http://bvbr.bib-bvb.de:8991/F?func=service&doc_library=BVB01&local_base=BVB01&doc_number=010340047&sequence=000002&line_number=0001&func_code=DB_RECORDS&service_type=MEDIA Inhaltsverzeichnis |
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| title | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective |
| title_auth | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective |
| title_exact_search | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective |
| title_full | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective Sudi Sudarsanam |
| title_fullStr | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective Sudi Sudarsanam |
| title_full_unstemmed | Creating value from mergers and acquisitions the challenges ; an integrated and international perspective Sudi Sudarsanam |
| title_short | Creating value from mergers and acquisitions |
| title_sort | creating value from mergers and acquisitions the challenges an integrated and international perspective |
| title_sub | the challenges ; an integrated and international perspective |
| topic | Mergers and Acquisitions (DE-588)4205916-1 gnd |
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