Acquisition, Other Management

Acquisition

An acquisition is slightly different from a merger. Unlike all mergers, all acquisitions  involve  one  company  purchasing  another  -  there  is  no exchange of stock or consolidation as a new company. One company can buy another company with cash, stock or a combination of the two.

Acquisition is likely to be friendly or hostile. In a hostile acquisition, the company, which is to be bought has no information about the acquisition and is taken by surprise. Usually, a company acquires another company against the wishes of the company being acquired. In a friendly acquisition, the companies cooperate with each other and go ahead with acquisitions. In acquisition, normally a larger company buys a smaller company. In some cases the minor company will acquire managing power of a larger company and retain the larger company's name. This is also well-known as reverse takeover.

Following are the types of acquisitions:

  • Asset deals: Under an asset deal, specific assets of a business are acquired to either wrap up its affairs or continue with another business opportunity.
  • Stock deals: Under a stock deal, instead of purchasing specific assets of the selling company, the stock or equity of the selling company is purchased at fair market value with all assets being acquired along with all their liabilities. The acquired company usually survives as a legal entity and continues to operate as subsidiary of the acquiring company.

The advantages of acquisition are as follows:

  • It provides a high speed access to resources.
  • It avoids barrier to entry.
  • It involves less reaction from competitors.
  • It can also block the competitor.
  • It provides an asset evaluation.
Posted Date: 9/28/2012 2:56:46 AM | Location : United States







Related Discussions:- Acquisition, Assignment Help, Ask Question on Acquisition, Get Answer, Expert's Help, Acquisition Discussions

Write discussion on Acquisition
Your posts are moderated
Related Questions
Staff Activity Area of library building -library management Main activities carried out by the professional staff of the library are: Acquisition, Technical Processing (catalo

sir,How to prepare the facility management exam assignment?

Question 1 Explain the steps in developing pattern for built-up neckline and cowl neckline along with  diagrams Question 2 What is pegged skirt? Explain the method of develo

C ultivating communities of practice In an organisational life, the CoP has been readily accepted by people. It will flourish irrespective of whether the organisation recognis

Self-Monitoring This is a personality trait reflecting an individual's ability to adjust behavior to match conditional factors. Individuals high in self- monitoring are very ad

A ligning Mergers and Acquisitions with Corporate Strategy In the previous section we learnt about the motives for acquisition. In this section, we will learn how to align Mer

Locus of Control Many people see themselves as very much in control of their lives. From them some see themselves as not being in control of the events which is happening aroun

Question 1: (a) Describe the five principles of bureaucratic management put forward by Max Weber. (b) Elaborate on the advantages and disadvantages of bureaucratic manageme

P urpose of management of quality Let us first discuss the importance of quality. Quality is  important  as  it  helps organisations achieve  their  internal and external g

The Kardex System: This system was introduced by the Remington Rand of India, Ltd. It is a type of visible record system maintained in a steel filing cabinet. Each unit cabine