Unit 2b. Mergers & Acquisitions

Part IBackground information Part IIReading Part IIIListening

Mergers and acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling and combining of different companies that can aid, finance, or help a growing company in a given industry grow rapidly without having to create another business entity.

Acquisitions Also known as takeovers The buying of one company (the target) by another.

Reverse takeover A smaller firm acquires management control of a larger or longer established company and keep its name for the combined entity.

Mergers A combination of two companies into one larger company. Beneficial to both parties Stock swap or cash payment

Reverse merger A deal that enables a private company to get publicly listed in a short time period. Occurs when a private company, usually one with no business and limited assets.

Hostile and Friendly Acquisitions Friendly acquistition  Companies cooperate in negotiations  DANON VS Wahaha

Hostile and Friendly Acquisitions Hostile acquisition  Target is unwilling to be bought or target’s board has no prior knowledge of the offer  Usually by purchasing the majority of outstanding shares of the target in the open market  Against the will of target’s board  Yahoo VS Microsoft

Classifications of mergers Horizontal mergers ( 同业合并、横向合并 )  Lenovo VS IBM Vertical mergers ( 纵向合并 )  MGM VS Sony Congeneric mergers ( 同源合并 )  Computer Monitor VS Projector Conglomerate mergers ( 集团合并、混合合并 )  Marionnaud VS Watsons

Questions: Mergers and acquisitions: what are the differences?

Acquisitions  one takes over another/established itself as the new owner  Target ceases to exist Mergers:  Two firms agree to make a single new company  Daimler-Benz VS Chrysler Distictions

Read the passage on Page 22.  Find all examples of M&A in this passage.  What are the motives of M&A behind each example? II. Motives behind M&A(1+1 >2)

Exxon & Mobil Deutsche Bank VS Bankers Trust Siemens VS Matra II. Motives behind M&A(1+1 >2)

Synergy:  Reduce duplication Increased revenue/Market Share Cross selling Economies of Scale Taxes Diversification Empire building II. Motives behind M&A(1+1 >2)

Business file: the magic of the merger Exxon 埃克森石油公司 Deutsche Bank 德国德意志银行 Bankers Trust 美国银行家信托公司（信孚银 行） Siemens 西门子公司（德国电器、电子制造 商） Matra 马特拉（法国高科技企业集团） Alstom 阿尔斯通公司（法国电力设备商及运 输系统公司）

Vodafone 沃达公司（英国移动电话运营商） AirTouch Communications 空中联系通信公司 （美国公司，被英国沃达芬公司收购） VodafoneAirTouch 沃达丰空中联系公司 AT&T （ American Telephone and Telegraph ） 美 国电话电报公司 Media One 传媒一号公司（英国互联网和移动 电话运营商）

BMW 宝马汽车公司 Rover Group 陆虎集团 Zeneca 杰尼卡（英国制药公司） Astra 艾斯特拉制药公司（瑞典） AstraZeneca 艾斯特拉杰尼卡公司 Losec 洛塞克, 艾斯特拉制药公司生产的治溃 疡

Daimler-Chrysler 戴姆勒 - 克莱斯勒公司（德 国汽车制造商） Mannesmann 曼内斯曼公司（德国电讯运营 商, 被英国沃达芬公司收购） Bell Atlantic 贝尔大西洋公司（美国电信业 务运营商）

Desperately 不顾一切地 Defence group 军工企业 Consortium 财团 Record 空前的，创记录的 Swap 交换 Portfolio 组合 Equity stake 股份 Destablize 使 … 不稳定

Listening: A Merger of Equals

all-share science-based long-term growth worldwide presence 3 rd largest innovation-led academic institutions restructuring administration executive team