Mergers in corporate finance : identifying the characteristics of mergers and their effect on post-merger performance (a case study) -

Abstract

The implementation of financial liberalization and deregulation in most economies helped us witness a surge in merger activity between institutions both domestically and across borders, thus altering the landscape of markets and economies all together. As a result, expanding financial markets are faced with a changing set of counter acting forces, mainly those of supply and demand. In the United States, where capitalist mentality dominates and competition is fierce the stakes are even higher. The decomposition of these modern economies has had a dramatic influence on how company CEOs and business owners view financial and planning decisions. In fact they are faced with the constant challenge of attracting a larger customer base, maintaining a healthy rise in profits, increasing value and appealing to the investor all at the same time. In this respect the world of finance has to offer a cornucopia of practices that promise to build a sound business model, which gives rise to the topic at hand, merges in corporate finance. The stability of global financial markets is a public good. If governments and financial regulators fail to protect this public good, then those who stand to lose the most are the working class, the people whose jobs, homes and livelihood depend on it. In the past few decades we have witnessed huge strides in global market integration, driven by policies of financial liberalization and deregulation, which have made businesses increasingly global. But relying on law makers to protect the common interest is no longer enough, investors need to live up to their responsibility as well when it comes to shaping the market.Engaging financial strategies and questioning their validity can only be accomplished when investors know what to look for when a merger decision is brought onto the table. As manufacturing and trade become global, financial planning needed to follow suit, and in these rising capital markets the world is forever new. For developed economies, such as the US, large enterprises mainta