Mergers and Acquisitions

Paper Summary:

The paper defines mergers and acquisitions and their benefits and costs. The paper examines reasons behind these transactions and the advantage of using cash as opposed to stock as the currency for the acquisition. The paper details the financial risks of merging with or acquiring an organization in another country and explores how those risks could be mitigated.

Outline:
What Are Mergers? What Are Acquisitions?
Benefits and Costs of Mergers and Acquisitions
"Sensible" and "Dubious" reasons for Mergers and Acquisitions
Financing: Cash versus Stock
Financial Risks of Merging With or Acquiring an Organization in Another Country

From the Paper:

"When one company takes over another company and clearly established itself as the new owner of the larger entity, this is called an acquisition. The swallowed-up entity has officially and legally ceased to exist. During an official merger, both companies' stocks are surrendered and new company stock is issued to shareholders, although quite often, rather than a merger of equals, one company dominates the other company during and after the merger."

Sample of Sources Used:

• "Mergers and Acquisitions: Definition." 2006). Investopedia. Retrieved 5Dec 2006 at http://www.investopedia.com/university/mergers/mergers1.asp
• "Mergers and Acquisitions: Valuation Maters." (2006). Investopedia. Retrieved 5Dec 2006 at<http://www.investopedia.com/university/mergers/mergers2.asp>
• "Mergers and Acquisitions: Why They Can Fail." (2006). Investopedia. Retrieved 5Dec 2006 at<http://www.investopedia.com/university/mergers/mergers5.asp>

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