Summary

• Take over
– Both companies survive
– Controlling Stake (not necessary more than 51%)
– Different from Portfolio investment
– Colloquially used as a synonym of Acquisition
– Different definitions in some countries viz. UK

• Merger
– Acquisition
• The Target company does not survive
– Consolidation
• Neither of the company survives
 Summary
• Horizontal Merger
– Lipton and Brooke Bond
– ICICI Bank with BoR

• Vertical
– Time Warner and AOL

• Concentric
– Adlabs and Big flix

• Conglomerate
– Walt Disney and ABC (American Broadcasting company)
– Sony and Fox Pictures
 Summary
• Takeovers and Mergers
– Friendly
– Hostile

• Finance and Process

– Direct Buyout
– Leveraged Buy out through an SPV

• Do Takeovers, Mergers create value?

– Most have destroyed value
– Many have created enormous value