Anti Trust and Consumer Protection Laws

[Name of the Institute]

Anti Trust and Consumer Protection Laws

Introduction

Mergers and acquisitions are seen as a means of increasing the growth or strength of companies. The strategy is always as expected in terms of increased profitability, economies of scale, market penetration and technology acquisition. The crucial question remains, why do so various operations is not meeting the expectations required? In the short term, numerous acquisitions apparently look good, but the disappointing productivity levels often masked behind remarkable cost savings, sale of assets or clever tax manoeuvres' that inflated the figures from financial statements in the early years. Profits from mergers are very difficult to assess. Traditionally, the criteria selected by analysts are

Ratios "gain on earnings", determined by dividing the profits (before distributions and taxes) for net operating income. This indicates the effectiveness of the company to complete projects profitable.

Change in stock prices (in the case of publicly traded companies)

Assessments management

Therefore, many financial experts have concluded that the beneficiaries of a merger and acquisition activity are those who sell their shares when announcing the agreement and who are participating and advising the transaction. Many decision makers still look to mergers and acquisitions as an exclusively rational, financial and strategic, rather than as a process of integration of human, material, financial and technological (Sherman, 2010). That is why financial and strategic considerations, along with the price and availability, dominate the selection of the target, leaving aside issues such as adaptation of the people and the socio-political. When you enter a large and sudden change, mergers create uncertainty and confusion. This can lead to lost productivity, increased absenteeism and staff turnover, sabotage and power struggle. Ironically, this occurs at the same time when companies need and expect higher productivity, cooperation, flexibility and loyalty from employees (Gaughan, 2005). The explanations for the failures of mergers tend to focus on re-evaluate the factors that drove the initial investment decision, including

The payment of an inflated price to acquire the company

Poor strategic alignment

Failure to achieve potential economies of scale due to financial mismanagement or incompetence.

Discussion

Successful results are closely linked, a thorough investigation and evaluation of resources, financial, technological, human, material, political and social environment of the company to acquire and to identify synergies and conflicts with the acquirer. Correctly estimate the value of the business, by integrating organizational members, shareholders and employees, as well as minimize the concerns of individuals. Standardize management styles; make clear lines of communication, responsibilities and powers. Clearly define all shareholders and employees the objectives, goals, rules, methods of measurement and rewards and gain acceptance and commitment. Integrate technological processes or implement new ones. Define and ensure effective and efficient cooperation with suppliers. Ensure the loyalty of consumers. Communicate to consumers the attributes and benefits obtained. We recommend periodic assessment by an outside professional that perception, understanding, acceptance and achievements are as expected or recommend corrective action.

Last year, mergers and acquisitions in the world represented a total of 3.79 billion, 38% more than in 2005, according to estimates by ...