BS 2 Assignment

Name Piyush Mathur Sec- B Enrollment No- 11BSPHH010578 CP 2 Mob- 9666783020

Questions Given
1. Identify 20 different types of mergers with example of each. Justify the decision for a particular choice and if so, based on what criteria. 2. Identify 20 different types of acquisitions with examples of each. Justify the decision for a particular choice and if so, based on what criteria.

Mergers

Horizontal Merger
Two companies that are in direct competition and share the same product lines and markets. AOL (Internet Service Provider) and Time Warner (Media and Entertainment Corporation) Executives of both companies sought to capitalize on the convergence of mass media and the Internet. The merger gave Time Warner new platforms for its media properties like Time, People, Fortune, Warner Entertainment, HBO and CNN. In turn, Time Warner gave AOL access to its cable systems, which allowed for much speedier Internet and interactive television services.

Market Extension Merger

Market extension merger takes place between two companies that deal in the same products but in separate markets The main purpose of the market extension merger is to make sure that the merging companies can get access to a bigger market and that ensures a bigger client base

Acquisitions

1. Market Extension Acquisition (Acquisition of Eagle Bancshares Inc by the RBC Centura)
Market extension merger takes place between two companies that deal in the same products but in separate markets The main purpose of the market extension merger is to make sure that the merging companies can get access to a bigger market and that ensures a bigger Client base Eagle Bancshares handles almost 90,000 accounts and assets worth US $1.1 billion. With the help of this acquisition RBC got a chance to deal in the financial Market of Atlanta and Georgia , which were among the leading upcoming financial markets in the USA. This move would allow RBC to diversify its base of operations in North American Market.

(2. Cross Border Acquisition (Acquisition of Corus by Tata-Steel $12.2 billion)

Cross Border Acquisition takes place when a company from different country purchases another company in Foreign Country. Tata Steel purchased a 100% stake in the Corus Group at 608 pence per share in an all cash deal. There were a lot of apparent synergies between Tata Steel which was a low cost steel producer in fast developing region of the world and Corus which was a high value product manufacturer in the region of the world demanding value products. Tata was one of the lowest cost steel producers in the world and had self sufficiency in raw material. Corus was fighting to keep its productions costs under control and was on the look out for sources of iron ore.

(2. Cross Border Acquisition) (Acquisition of Corus by Tata-Steel $12.2 billion)

This would give the European manufacturer an in-road into the emerging Asian markets. There would be technology transfer and cross-fertilization of R&D capabilities between the two companies that specialized in different areas of the value chain. Tata was a major supplier to the Indian auto industry and the demand for value added steel products was growing in this market. Hence there would be a powerful combination of high quality developed and low cost high growth markets

3. Product Extension Acquisition ( Acquisition of Mobilink Telecom Inc. by Broadcom )

Product extension merger takes place between two business organizations that deal in products that are related to each other and operate in the same market. The product extension merger allows the merging companies to group together their products and get access to a bigger set of consumers. Broadcom deals in the manufacturing Bluetooth personal area network hardware systems and chips for IEEE 802.11b wireless LAN. Mobilink Telecom Inc. deals in the manufacturing of product designs meant for handsets that are equipped with the Global System for Mobile Communications technology. It was expected that the products of Mobilink Telecom Inc. would be complementing the wireless products of Broadcom and hence get access to a bigger set of consumers and earn higher profits.

4. Vertical Acquisition (Acquisition of Abbot Point Coal by Adani Enterprises)

A vertical Acquisition is a combination of two companies which are operating in the same industry but at different stages of production or distribution system. Adani acquired the Australian Abbot Point Port for 1.9 billion dollars. The deal will help the Adani group ship out coal from an Australian mine it has acquired last year Adani will expand the installed port capacity to 80 million tonnes in the near future to export coal from our recently acquired Australian mine to secure coal supplies for projects in India. The acquisition will strengthen Adanis presence outside India.

5. Reverse takeover (NYSEARCHIPELAGO)

A reverse takeover or reverse merger (reverse IPO) is the acquisition of a public company by a private company typically through a simpler, shorter, and less expensive process. The New York Stock Exchange was acquired by Archipelago Holdings to form NYSE Group, with the goal of taking the former, a mutual company, public. By linking up with Archipelago, the NYSE will gain a 25-percent share of trading in the over-the-counter market.

The NYSE will acquire the options business of the Pacific Stock Exchange. It will deepen its business in the trading of exchangetraded funds, which are growing rapidly, and gain a new platform for trading bonds and other financial instruments.

5. Reverse takeover (NYSEARCHIPELAGO)

The Exchange will also build a new listings platform to expand its market share and to give companies that do not currently meet the NYSE's criteria a choice of where to list. It also gives the new entity the capacity to expand or deepen their business model across multiple asset classes, including options, ETFs, Nasdaq, debt instruments.

6. Horizontal Acquisition (Vodafone-Hutchison-Essar)

The horizontal acquisition involves acquisition of a direct competitor which they share same product lines and same Markets.
The acquisition of the Hutch-Essar, which has over 23 million subscribers and is India's fourth largest mobile company, would be executed through Vodafone's subsidiary Vodafone International Holdings B V.

The acquisition was a strategic move as the European markets have become saturated.
The deal will give Vodafone a foothold in the worlds fastest growing mobile market, which is adding about 6 million subscribers every month

6. Horizontal Acquisition (Vodafone-Hutchison-Essar)

To bring innovative products and services to Indian market including Vodafones focus on total communication solution for Indian customers. Accelerates Vodafones move to a controlling position in a leading operator in the attractive and fast growing Indian telecom market.

7. Conglomerate Acquisition

(Walt Disney and American Broadcasting Company)

It includes firms which are totally in unrelated businesses, neither horizontally or vertically both companies that they will grow more quickly together than on their own and provide increased opportunities for Disney to expand overseas.
That should make the ABC network a more formidable rival to its counterparts and to the cable programming services that continue to erode the networks' share of audience. The combined company would bring together the most profitable television network and its ESPN cable service with Disney's Hollywood film and television studios, the Disney Channel, its theme parks and its repository of well-known cartoon characters and the merchandise sales they generate.