1. Please pick up a Warm Up sheet from the folder on the table in front, get out a pen or pencil, and wait for today’s question to appear on the board.

2. Warm Up
Why are monopolies bad for consumers?

3. Friday, March 4, 2016
Objective: Students will be able to explain why mergers and acquisitions occur. Purpose: Mergers and acquisitions change the market and can significantly affect the price of goods and services.

4. Mergers Merger: the combining of two businesses into a single business
Many large corporations grew to their current sizes through mergers
Examples: AT&T, Comcast, ExxonMobil, NFL, Office Depot

5. Acquisitions
Acquisition: purchase of one business or company by another company or other business
Usually refers to a purchase of a smaller firm by a larger one
Reverse Takeover: when a smaller firm purchases a larger firm and keeps the name of the larger firm

6. Purposes for Mergers and Acquisitions
To improve profits
To enter new markets
To diversify a company’s offerings
To stay in business

7. After Mergers Successful mergers are due to the following factors:
Synergy
Efficient integration
Establishment of a new company culture
Many similarities between the companies merging
Great communication between employees

8. Issues with Mergers and Acquisitions
Possible factionalization of work force/lack of unity
Alienation of customers
Possible loss of jobs
Legality: all mergers and acquisitions are reviewed by the Justice Department to see if the “new” company is not a _________.
Is there still fair competition in that industry?
Does the merger/acquisition create a monopoly?

9. Common Mergers Airlines Oil and Gas Telecommunications Banking
TV/Internet providers

10.
About the United-Continental merger of 2011
Issues with American Airlines-US Airways merger
Top 10 worst mergers