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Success Factors of International Mergers and Acquisitions

Dependence on more than the financial evaluation of the organisations involved

Essay 2010 27 Seiten

BWL - Unternehmensführung, Management, Organisation

Leseprobe

Contents

Illustrations

Tables

Abbreviations

1 Introduction

2 Basics on Mergers & Acquisitions (M&A)
2.1 Definition
2.2 The M&A process
2.3 Expected benefits of international M&A

3 The human side of successful M&A
3.1 Individual’s perception of M&A
3.2 The merger model of trust
3.3 Consideration of different organisational cultures
3.4 Aspects of cross-cultural communication
3.5 Leadership and management in cross-border M&A

4 Conclusion

References

Illustrations

Figure 1: Cross-border M&A amount from 1987-2006 (in Mio. US-Dollars)

Figure 2: Model of trust in the postacquisition integration process

Figure 3: The categories of trust determinants

Figure 4: Cultural levels and their interaction

Figure 5: Hofstede's culture value dimensions

Figure 6: Selected leadership styles in different cultures

Figure 7: Six-Dimension Integrative Model of Leadership

Tables

Table 1: Major characteristics of verbal styles

Abbreviations

Abbildung in dieser Leseprobe nicht enthalten

1 Introduction

At the beginning of 2010 the United Nations Conference on Trade and Development (UNCTAD) reported a total volume of cross-border mergers and acquisitions (M&A) volume for 2009 of 239.9 billion US-dollars. Even if this sounds like a huge volume the global M&A market was considerably affected by the economic crisis and decreased by 66% compared to the volume of 2008 where we had a total volume of 706.5 billion US-dollars of cross-border sales (UNCTAD, 2010a). The following chart shows that international M&A’s play a significant role in todays economy.

Abbildung in dieser Leseprobe nicht enthalten

Figure 1: Cross-border M&A amount from 1987-2006 (in Mio. US-Dollars) [1]

Beside that a quarterly survey conducted by Hewitt Associates showed up that 54% of European headquartered organizations evaluated already completed transactions as not as successful as they were intended to be and did not reach the initial financial and strategic objectives (Hewitt Associates, 2010).

Why do companies still do international M&A’s even if it seems that they fail to reach their targets in so many cases? The target of this essay is to evaluate why M&A’s are still so important for businesses and to show up that the success of international M&A’s is dependent on more than the financial evaluation of the organisations involved.

Therefore this essay provides some basics on international M&A’s including types of M&A’s, according processes and expected benefits. Based on that it evaluates the human side of M&A’s and how this influences the successful implementation.

2 Basics on Mergers & Acquisitions (M&A)

2.1 Definition

Although the terms merger and acquisition are often used simultaneously, both terms have slightly different meanings. According to the Oxford English dictionary a merger is defined as ‘a merging of two things, especially companies, into one’. In comparison to that an acquisition is defined as a takeover of a sufficient part of another company to gain control (Cartwright & Cooper, 2001). Several types of mergers or acquisitions can be found in literature. Most popular types according to Forstmann (1998) are:

[...]


[1] (UNCTAD, 2010b)

Details

Seiten
27
Jahr
2010
ISBN (eBook)
9783656354628
ISBN (Buch)
9783656354734
Dateigröße
1.6 MB
Sprache
Englisch
Katalognummer
v208118
Institution / Hochschule
Hochschule für angewandte Wissenschaften Ingolstadt
Note
1,0
Schlagworte
success factors international mergers acquisitions

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Titel: Success Factors of International Mergers and Acquisitions