managerial incentive to enter value-destroying bank acquisitions. We find that diversifying bank acquisitions earn significantly negative announcement period abnormal returns (AR) for bidder banks whereas focusing acquisitions earn zero AR. We then find that corporate governance variables (such as CEO share and option ownership and a smaller board size) in the bidding bank are less effective in diversifying acquisitions than in focusing acquisitions. These results are robust to the inclusion of the usual
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Starting with the End in Sight: Integrating Finance After a Merger 2 When two companies merge, integrating their Finance functions is a major imperative. Variations in financial standards and procedures can prevent the merged entity’s Finance function from effective daily operations, impacting both internal and external stakeholders. Integration of this key function is also time-sensitive: the entity’s leaders, not to mention investors, demand consolidated financial statements, earnings and
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example make acquisitions when cash-rich (Shefrin, 2007, p. 6). The acquisition Circon went for in 1995 buying Cabot is a clear link to this behavior. Circon had its largest stack of cash in 1995 ($17.58 Million) and Auhll went to buy a company in another part of the industry, he show strong influences of overconfidence in his ability to exploit the possible synergies. Auhll believed that he would be able to turn around Cabot in the same way that he had turned around the previous acquisition of ACMI.
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reached next step. Foreign airlines entry will depend on the results of this deal. Government has planned to construct 50 low cost Airports. Delhi will be first among them. Mergers & Acquisitions Due to high competition and slim profits there has always been an urge in the Aviation industry for mergers and acquisitions. Since it helps the airline to
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01 Technical takeovers, and managing relevanT To acca QualificaTion paper p3 1 Market growth, for example, by taking over a competitor. This could produce synergy through economies of scale and efficiency gains, and can decrease the threat from competitors. Both of these should help to increase shareholder wealth. There is, in theory, relatively little risk as the company is staying on its home territory which it knows well, but see the information about the Morrison’s – Safeway merger on
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Krishnan In an ideal merger, the newly created entity pools the best features of the two merging organizations. A well planned process built on the foundations of an open, honest and consistent communication strategy can pave the way. Mergers and acquisitions have become a common phenomenon in recent times. A merger of the size like HP-Compaq has implications for the workforce of these companies across the globe. Although the merging entities give a great deal of importance to financial matters and
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SESSION 9 PRE-WORK 1000 words max in total, although some questions may require more than 100 words (question 5). P.C: “Freeport-McMoRan: financing an acquisition” 1/What is a poison pill? What is a white knight? A poison pill is a shareholders’ right plan approved by the Board of Directors of a corporation to discourage hostile takeovers. There are two types of poison pills: a) Flip in: shareholders have the right to buy more shares at a discount, if a bidder buys
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Development of Training and Mentoring Program The critical first step in effective training and mentoring is to relate the training needs of the workforce to the achievement of organizational goals. The newly merged InterClean’s, CEO strategic vision for growth and continued success-both domestically and worldwide is to develop and introduce full-service solution packages, and simplified cleaning efforts in compliance with the more stringent environmental safety laws and regulations. The new
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My Firm Acquisition Juwelene Jones Cecil Pharr International Business Environment – ITB 305 May 29, 2011 1. As a CEO, you are trying to acquire a foreign firm. The size of your firm will double, and it will become the largest in your industry. What does your firm do and what does the foreign firm you are trying to acquire do? Where are the firms based? My firm is an architecture firm. An architecture firm is a company which specializes in providing architectural services
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Acquisition Strategy An acquisition strategy consists of a company having the agenda to further its success through acquiring other companies. Through acquisitions companies are oftentimes able to enhance resource strengths to gain a competitive advantage in their respective industries. We are seeing more and more companies with acquisition strategies in recent decades, fast becoming one of the major driving forces in many industries in America. Although acquisition relates more to the management
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