Management and Organizational Studies 1023A/B Lecture 8: Lecture 8

• School: Western University
• Department: Management and Organizational Studies
• Course: Management and Organizational Studies 1023A/B
• Professor: Maria Ferraro

Document Summary

Take-over = acquisition purchase of one firm over the other. Merger two companies join and new company is formed = amalgamation two companies of similar size come together as one. Take-overs are often marketed as mergers because it sounds friendlier. Do this to combine related business transactions saves money. Synergies can be achieved and brand names can be exploited. Vertical is going through the value chain for any industry. Suppliers bought by manufacturers, or distributor bought by manufacturers. Car manufacturers are an example of fully integrated vertical companies. The risks for this is high locks you into a certain industry. Unrelated diversification create a portfolio of diversified companies in different industries. Look for undervalued companies buy cheap and add value and sell high. Look for companies with growth potential but don"t have the money to take it further. Value comes from the corporate office to build value for the shareholders.