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Bus 499 Assignment 4

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RUNNING HEADER: BENEFIT OF MERGING AND STAYING INDEPENDENT

Assignment 4:
Merger, Acquisition, and International Strategies
By:
Professor Unknown
Business 499
Business Administration Capstone
Strayer University
Winter Quarter 2015

BENEFIT OF MERGING AND STAYING INDEPENDENT

Every week as we fill up our gas tanks and wonder why gas prices are up and down; we wonder a few things. How much is this company making off us? Why are gas prices going up now? As I get to what this assignment is about, the question for you I have is. Do you think and oil company could get even bigger? In 1999, Exxon and Mobil agreed to an $80 billion dollar merger to form Exxon- Mobil Corporation. According to Mary DiMaggio’s article, “The Top 10 Best (and Worst) Corporate Mergers of All Time... Or, the Good, the Bad, and the Ugly”, dated 9/15/09, not only did Exxon- Mobil become the largest company in the world, but it reunited its 19th century former selves, John D. Rockefeller’s Standard Oil Company of New Jersey (Exxon) and Standard Oil Company of New York (Mobil). In my opinion and based on research I think the merger was a wise choice. It’s a wise choice because they set themselves up to lead in a few different markets. You could say that they are a small rich oil nation. The first reason I think it was a wise choice because now that the two companies have merged they have reduced their expenses. Reducing expensing means more money in revenue. Another reason I believe the merger of the two companies was a wise choice because the two companies create synergies and efficiencies enabling the new company to provide high-quality products to consumers at more competitive prices. In a statement, the two CEOs of the company stated that was one of their strategies of why they felt merging the two companies was the best thing to do. By joining forces the two have cut duplicative functions, capture economies of scale, increase their buying power and build stronger balance sheets.

Next, I researched a company that has not been involved in any mergers or acquisitions that would be a profitable candidate for a corporation to acquire or merge with is a company
BENEFIT OF MERGING AND STAYING INDEPENDENT

called Jones Energy. Jones Energy based out of Texas and who as of 2013 became an Initial Public Offering (IPO) Company in the New York Stock Exchange (NYSE) is a family company who was founded by Chief Executive Officer (CEO) Johnny Jones in 1988. Jones Energy is and independent oil and gas company engaged in the development, production and acquisition of oil and natural gas properties in the Anadarko and Arkoma basins of Texas and Oklahoma.

Resources http://money.cnn.com/1998/12/01/deals/exxon/ The Top 10 Best (and Worst) Corporate Mergers of All Time... Or, the Good, the Bad, and the Ugly, Mary DiMaggio, 2009
14 oil companies that should start looking for merger partners - The Deal Pipeline http://www.thedeal.com/content/energy/14-oil-companies-that-should-start-looking-for-merger-partners.php#ixzz3TBmAVc51

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