Waiting for a company to increase in size through natural, organic expansion can take years. It can even take decades to reach the desired level. However, by using the business strategy of M&A, an ambitious company can become significantly larger in a fraction of the time. M&A is often viewed as a convenient method of combining the assets of rivals. Competition In terms of competition, there are two reasons why companies choose M&A. One is to expand its own market …

One of the main factors, that influence management decisions regarding to mergers and acquisitions are the prevailing interest rates. Rising interest rates in a slowly growing economy, have a negative impact on the M&A market. This means that the speed at which interest rates rise or fall is a key factor affecting the M&A market. A slow but gradual rise in interest rates in a strong economy builds confidence among businesses and this results in increasing M&A activity. On the …

M&A usually describes a range of business strategies that are used to improve performance and profit. However, M&A is also associated with quite different measures. Mergers are the result of two companies of similar size agreeing to combine their assets and resources into one effective business. An acquisition is one business taking over another. Some may be conducted in unfriendly circumstances but many more are perfectly amicable. A business involved in an acquisition can sometimes be concerned over the apparent …

There can be a variety of motives behind a merger or acquisition. Some companies are hoping to increase in size or create a more efficient enterprise. Others want to raise the value of shares or eliminate a rival. Whatever the reason is, the procedure usually follows the 13 steps outlined below. 1. Identify Targets Companies opting for M&A, usually draw up a list of possible enterprises, which they view as potential targets. In order to determine a suitable target, it …