Mergers and Takeovers (Edexcel A-Level Business): Flashcards
📚Flashcards
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Practise the cards
10 cards from this deck
Merger
Merger
Voluntary agreement where 2+ businesses join as one organisation
Takeover (acquisition)
Takeover (acquisition)
One business purchases another by buying its shares
Synergy in mergers
Synergy in mergers
Combined business more powerful than separate parts (2+2=5)
Horizontal integration
Horizontal integration
Businesses at same production stage in same industry join
Backward vertical integration
Backward vertical integration
Joining with a supplier from earlier production stage
Forward vertical integration
Forward vertical integration
Joining with business at next production stage
Hostile takeover
Hostile takeover
Target company's board of directors resists the acquisition
% shares needed for takeover control
% shares needed for takeover control
At least 51%
M&A failure rate statistic
M&A failure rate statistic
90% of mergers fail to meet their original objectives
CMA role in UK mergers
CMA role in UK mergers
Scrutinises mergers to protect consumer interests & competition