Name- Aditya Nair

Roll no- 191113

Subject- Strategic Management
Stream- Operations

Case Study- Reliance Industry

Questions: 

1) As a strategy professional, how do you look at the results? (5Marks)

Mukesh AMBANI'S big decision at the general meeting of the RIL is highlighted
below.
1.Ready for foreign acquisition and to increase size and scope to broaden business
outside the region.
2.Ready for cooperation and joint venture.
3. Agriculture and Rural Business research and development.

Now, looking at all of the above decisions, I would conclude that the results might be
in favour of Reliance Industry Ltd regardless of the justification for following

1. Reliance Joint venture with GAIL (INDIA), a government-owned company, will

offer the reliance industry several advantages. Reliance will have certain advantages
as a private corporation, such as closed ownership, and GAIL will have certain
advantages as a pool of finance, such as access to stock issuance. Both of these
advantages can be used together and will allow the industry to expand well. To
maximize benefit, both of these advantages can be synergistic ally merged.
2. Reliance Industry would also be advantageous for all firms to join the Kuwait
petrochemical venture because this would provide Reliance a chance to acquire local
management in Kuwait and reduce the risk to Kuwait's Reliance Industry.
3. A door for acquisition has been opened by Reliance. Acquisition is indeed a smart
move because it tends to diversify and reduce the burden for businesses. This
improves the company 's returns as well. The following are other advantages that
Dependency can acquire from acquisition.
 Reliance may be supported to improve its power.
 Reliance will assist in achieving economies of scale.
 It will help to focus on new vendors, dealers, and consumers.
 This will help to acquire new innovations.
 It will mitigate tax commitments.

4. Research and development in the field of Agriculture sector is a great

move because India is known for its agriculture goods and innovating in
this sector will help Reliance to stand as Indian Multinational Company.

Business is dynamic in nature therefore predicting 100 % future is not

possible but looking at all this benefits if everything goes well the
result are going to be in favour of Reliance Industry.

2) What has been the experience, in general, with

mergers/acquisitions and joint ventures? (5 Marks)
The best approach for firms to grow and reduce risk is always merger / acquisition
and joint partnership and would enable businesses to remain successful in the future.
But ordinary citizens who assume that the business is not making profits and thus
struggling to succeed are often misled in this approach and therefore went to JV or
went to merge.
If this plan is not adequately applied, all firms will be affected by a backfire. Below is
the key explanation why JV or Merger / Acquisition does not work.
 Difficulty of integration
 Companies are highly indebted.
 Companies are unable to create synergies
 The company is trying to diversify a lot.
 Question of convergence due to multiple corporate cultures
 It demotivates workers because of dismissals and re locations.

Whereas company look for joint venture or Merging for following

reasons.

 Leverage Resource- This will help both companies to share the resources
and will help company to achieve goal.

 Cost Saving- JV can help in reducing the cost per unit and will be
beneficial for both companies.

 Combined Expertise- Both the companies can share the expertise and will
help both the companies to grow.

Most common experience in general has always help both the

companies to survive and sustain in market in difficult time. Taking the
example of Vodafone and Idea when both the companies were failing to
survive they enter a joint venture and are trying to help each other to
survive in telecom industry.