Question

In: Finance

List at least three weaknesses of the Merger and Acquisition analysis.

List at least three weaknesses of the Merger and Acquisition analysis.

Solutions

Expert Solution

  • Merging two firms that are doing similar activities may mean duplication and over capability within the company that may need retrenchments.
  • Increase in costs might result if the right management of modification and also the implementation of the merger and acquisition dealing are delayed.
  • The uncertainty with respect to the approval of the merger by proper assurances.
  • In many events, the return of the share of the company that caused buyouts of other company was less than the return of the sector as a whole.
  • Loss of experienced workers aside from workers in leadership positions. This kind of loss inevitably involves loss of business understand and on the other hand that will be worrying to exchange or will exclusively get replaced at nice value.
  • Company will face major difficulties thanks to frictions and internal competition that may occur among the staff of the united companies. There is conjointly risk of getting surplus employees in some departments.

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