BUS 432 Chapter Notes - Chapter 5: Organizational Culture, Vertical Integration, Human Capital
11 May 2016
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A merger occurs when two companies join together to create a new entity, while in an acquisition one company acquires sufficient shares to gain control of the other. There are a number of reasons why firms engage in international m&as, including response to political or economic conditions, diversifying risk, vertical integration, and reducing costs. Two of the main reasons for m&as are to achieve competitive size or to increase market share by adding brands or distribution channels. Box 5. 1: m&a success and failure (page 89) Cross-border m&as require a double layered acculturation organizations must align both organizational and national cultures" one may conclude that they will be significantly more challenging than domestic m&as. However, distance may be a good thing and people focus more on culture in cross-border. Most m&a transactions are one of two types: either traditional or transformational. Traditional m&as leverage existing capabilities through rationalization or transfer. Preservation acquisition: when no culture change is required.
