a study on mergers and acquisitions in india

GALAXY International Interdisciplinary Research Journal______________________________ ISSN 2347-6915
GIIRJ, Vol.3 (5), MAY (2015), pp. 91-102
A STUDY ON MERGERS AND ACQUISITIONS IN INDIA
RAYUDU GANGADHAR, L.L.M., M.B.A., (Ph.D)*;
Dr. P.VIJAYA KUMAR, M.Com, Ph.D**;
Dr. P.VENU GOPAL, MBA, Ph.D***
*RESEARCH SCHOLAR
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY
KAKINADA, EAST GODAVARI DISTRICT, ANDHRA PRADESH, INDIA.
**DIRECTOR & PROFESSOR, SCHOOL OF MANAGEMENT STUDIES,
JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY
KAKINADA, EAST GODAVARI DISTRICT, ANDHRA PRADESH, INDIA.
***PROFESSOR, VIT BUSINESS SCHOOL, VIT UNIVERSITY,
VELLORE, TAMIL NADU, INDIA.
ABSTRACT
Mergers and acquisitions (abbreviated M&A) refer to the aspect of corporate strategy,
corporate finance and management dealing with the buying, selling, dividing and combining
of different companies and similar entities that can aid, finance, or help an enterprise grow
rapidly in its sector or location of origin or a new field or new location without creating a
subsidiary, other child entity or using a joint venture. The distinction between a "merger" and
an "acquisition" has become increasingly blurred in various respects (particularly in terms of
the ultimate economic outcome), although it has not completely disappeared in all situations.
Achieving acquisition success has proven to be very difficult, while various studies have
shown that 50% of acquisitions were unsuccessful The acquisition process is very common,
the. A study published in the July/August 2008 issue of the Journal of Business Strategy
suggests that mergers and acquisitions destroy leadership continuity in target companies’ top
management teams for at least a decade following a deal. The study found that target
companies lose 21 percent of their executives each year for at least 10 years following an
acquisition – more than double the turnover experienced in non-merged firms.[If the
businesses of the acquired and acquiring companies overlap, then such turnover is to be
expected; in other words, there can only be one CEO, CFO at a time. Mergers and
acquisitions are undertaken by companies to achieve certain strategic and financial
objectives. They involve the bringing together or two organizations with often disparate
corporate personalities, cultures and value systems. Success of mergers may, therefore,
depend on how well the organizations are integrated. companies making acquisitions and
merging with other companies are unable to create value for their shareholders. Various
market reforms initiated by the Government in the form of de-regulation have forced the
Indian companies to acquire competitive edge for survival and further expansion. This paper
studies the importance, implementations, failure factors of mergers and acquisitions in Indian
companies and to suggest measures for their success.
KEY WORDS: Shareholders, wealth maximisation, corporate strategy.
GALAXY International Interdisciplinary Research Journal______________________________ ISSN 2347-6915
GIIRJ, Vol.3 (5), MAY (2015), pp. 91-102
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GALAXY International Interdisciplinary Research Journal______________________________ ISSN 2347-6915
GIIRJ, Vol.3 (5), MAY (2015), pp. 91-102
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