How merger and acquisition enhance the value of company. please provide 6 idea and explain the...

How merger and acquisition enhance the value of company. please provide 6 idea and explain the idea that you provide (25m)

Expert Solution

Mergers and acquisitions offer various advantages

1: by emerging together the companies become a big business and hence it is able to gain greater power .

2: benefits of synergy are received which allow for increase in value efficiencies.

3: there are benefits of economies of scale due to sharing of resources and facilities.

4: they enjoy a competitive edge by gaining a greater market share.

5: this is a good strategy if a firm wants to diversify into a new field or region.

6: there are various tax benefits that can be achieved by the mergers and acquisitions.

In my opinion the biggest benefit received by both companies by way of mergers and acquisitions is that of gaining the economies of scale. Due to the size of the company their purchasing power improves. This helps them in negotiating big orders and this leads to cost efficiency. Duplicate processes and resources are eliminated which results in greater economies of scale and benefit of lower cost is enjoyed by the merged entity.

jeff jeffy answered 10 months ago

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