Corporate Restructuring
A report on the growing market of mergers, acquisitions, and restructurings in the corporate world. Roll No – A3906407G43
Enrolment No – A3906407403 Sudhanshu Gupta |
Final Report
Guided By – Mrs. Kavitha Menon July 21, 2008 | CORPORATE RESTRUCTURING |
ACKNOWLEDGEMENT
I wish to acknowledge my deep gratitude to Mrs. Kavitha Menon for her valuable guidance, wise suggestions, mellow criticism & above all unflinching moral support throughout the work.
I wish to thank all the library and other member staffs for their co-operation & technical staffs for their assistance. I must also not forget to thank my family and friends for their constant support during the work.
Sudhanshu Gupta
B.B.A. (2007-10)
Roll No – A3906407G43
Enrolment No – A3906407403
INDEX
Abstract 7 1) Introduction 8 2) Difference between Merger and Acquisition 9 3) Mergers 10 a. Classification of Mergers 10 4) Acquisitions 12 b. Classification of Acquisitions 12 5) Motives Behind Acquisitions and Mergers 14 c. Economies of Scale 14 d. Synergy 15 e. Fast Growth 15 f. Tax Benefits 15 g. Diversification 16 h. Sales Enhancement 16 i. Improved Management 16 j. Information Effect 16 k. Wealth Transfer 17 l. Hubris Hypothesis 17 m. Resource Transfer 17 n. Management’s Personal Agenda 17 o. Manager’s Compensation 17 p. Vertical Integration 18 6) Financial Framework 18 q. Determining the Firm’s Value 18 i. Book Value 18 ii. Appraisal Value 19 iii. Market Value 19 iv. Earnings per Share 21 r. Financing Techniques in Merger 23 v. Cash 23 vi. Ordinary Share Financing 24 vii. Debt and Preference Share Financing 24 viii. Deferred Payment Plan 25 ix. Tender Offer 26 s. Analysis of the Merger as a Capital
Enrolment No – A3906407403 Sudhanshu Gupta |
Final Report
Guided By – Mrs. Kavitha Menon July 21, 2008 | CORPORATE RESTRUCTURING |
ACKNOWLEDGEMENT
I wish to acknowledge my deep gratitude to Mrs. Kavitha Menon for her valuable guidance, wise suggestions, mellow criticism & above all unflinching moral support throughout the work.
I wish to thank all the library and other member staffs for their co-operation & technical staffs for their assistance. I must also not forget to thank my family and friends for their constant support during the work.
Sudhanshu Gupta
B.B.A. (2007-10)
Roll No – A3906407G43
Enrolment No – A3906407403
INDEX
Abstract 7 1) Introduction 8 2) Difference between Merger and Acquisition 9 3) Mergers 10 a. Classification of Mergers 10 4) Acquisitions 12 b. Classification of Acquisitions 12 5) Motives Behind Acquisitions and Mergers 14 c. Economies of Scale 14 d. Synergy 15 e. Fast Growth 15 f. Tax Benefits 15 g. Diversification 16 h. Sales Enhancement 16 i. Improved Management 16 j. Information Effect 16 k. Wealth Transfer 17 l. Hubris Hypothesis 17 m. Resource Transfer 17 n. Management’s Personal Agenda 17 o. Manager’s Compensation 17 p. Vertical Integration 18 6) Financial Framework 18 q. Determining the Firm’s Value 18 i. Book Value 18 ii. Appraisal Value 19 iii. Market Value 19 iv. Earnings per Share 21 r. Financing Techniques in Merger 23 v. Cash 23 vi. Ordinary Share Financing 24 vii. Debt and Preference Share Financing 24 viii. Deferred Payment Plan 25 ix. Tender Offer 26 s. Analysis of the Merger as a Capital
References: 2) Financial Management & Policy, James C. Van Horne, Twelfth Edition, Pearson Education Asia, Delhi, 2007 3) Financial Management, I M Pandey