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MERGERS & ACQUISITIONS

MERGER

rger is a combination of two companies into one lar


company

merger occurs when one firm assumes all the assets


all the liabilities of another
Classifications of mergers

Horizontal merger

Vertical merger

Market-extension merger
ACQUISITIONS

quisition is the buying of one company by an

quisitions is also known as take over or buy o

quisition is the purchase of one company by


another with no new company being formed
DISTINCTION BETWEEN
ACQUISITION AND MERGERS

en one company takes over another and clearly establishes


the new owner, the purchase is called an acquisition.
m a legal point of view, the target company ceases to exist,

he pure sense of the term, a merger happens when two firm


n of about the same size, agree to go forward as a single ne
mpany rather than remain separately owned and operated.
Reasons for Mergers and
Acquisitions:

To produce goods or services more efficiently

Collaborating or sharing expertise may achiev


gains in efficiency
HR CONTROLS
• Train managers on the nature of change
• Technical retraining
• Stress reduction program
• Meeting between the counter parts
• Orientation programs
• Explaining new roles
• Helping people who lost jobs
• Post merger team building
• Anonymous feedback helpline for employees
strategic contribution of HR
for
M & A activity
 The strategic contribution of HR as
consisting of the “Five P’s”:

• Philosophy
• Policies
• Programs
• Practices
• Processes
ROLE OF HUMAN RESOURCES
IN
MERGERS AND ACQUISITIONS
The Human Side of M&A
Activity

 Retention of key talent


 Communications
 Retention of key managers
 Integration of corporate cultures.
HR issues in three Stage
Models of Mergers and
Acquisitions

 Pre-combination

 Combination and integration of the


partners

 Solidification and advancement


Pre-Combination
 Identifying reasons for the IM & A
 Forming IM & A team/leader
 Searching for potential partners
 Selecting a partner
 Planning for managing the process of
the IM and/or A
 Planning to learn from the process
Combination and
Integration
 Selecting the integration manager
 Designing/implementing teams
 Creating the new structure/strategies/ leadership
 Retaining key employees
 Motivating the employees
 Managing the change process
 Communicating to and involving stakeholders
 Deciding on the HR policies and practice
Solidification and
Assessment
 Solidifying leadership and staffing
 Assessing the new strategies and structures
 Assessing the new culture
 Assessing the new HRM policies and practices
 Assessing the concerns of stakeholders
 Revising as needed
 Learning from the process
CONCLUSION
 M&A is an effective and quick way to
expand new market horizons
 M&A adapt new technology in
capturing opportunities to leverage
competitive advantage.
 It is an established fact that this is a
double-edged weapon which may
operate in both the ways negative and
positive
THANK U

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