Financial Management

MBA 5924: Financial Strategy TMA01 Interest rates, currency, risk and M & A 05 March 2012 student name: Mr S Dalla Pria Student progeny: 72781793 CONTENTS motility 1 1. D 2. A 3. B 4. X 5. B 6. X 7. X 8. X 9. D 10. A 11. B 12. 13. B 14. B 15. A apparent motion 2 PART A (a) M & A The gist of whether mergers and acquisitions add real harbor to companies remains an issue of contention, attest in practise and in literature. There are synergism benefits vertical- and/or horizontal integrating (acquiring distri exactlyion or supply strand companies); technological synergy; capture of processes or brands; and cost savings through economies of home base (Course Team, 2010: 75). However, as Siyaya (a chain of bookshops) wants to look at Phaphama, a food shaper and and then totally unrelated. Rather, its matter to lies in having Phaphama Ltd. as a subsidiary, an acquired company that surviv es as a separate operation, but the business organization assets will snuff it to Siyaya.

Its nigh purely a business closing based on financial synergy diversification move potentially reduce risk, with access to more than debt (and thus reduced cost of capital), while increasing its specie flow (Course Team, 2010: 83) and greater amounts of leverage (private equity) can be secured. We should suss out the situation ring most acquisitions usually companies hit a gain doorstep where investor expectations cant continue to be met solely from natural growth of products and services (Course Team, 2010: 82). In contrast, S iyaya has genuinely lost commercialise sha! re in an industry sore by newer technologies. It could pee chosen to expand and compete in that sphere questions switch off around the quality and vision of management, and thus future growth potential, including the subsidiary. Historically, acquisitions look good in the short-term, but value is destroy over the long term acquirers almost always...If you want to foil a full essay, order it on our website: BestEssayCheap.com

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