merger & acquisition
kirtirani sole
(Querist) 09 November 2009
This query is : Resolved
Resp. Sir/Madam
can anybody please enlighten me what is the diference between merger,acquisition & takeover,compromise? what should be the due deligence for the same?
with regards
Kirti.
A V Vishal
(Expert) 09 November 2009
In an acquisition the acquiring company buys controlling stake in the acquired company. The acquired company is also referred to as ‘Target Company’. There are two types of acquisitions; Friendly acquisitions and Hostile acquisitions.
Mergers and Acquisitions (M&As) is a phrase commonly used to represent either merger or acquisition or both. A merger usually takes place between two or more companies of same size. The main purpose of a merger is to create a new firm with combined shareholder value exceeding the sum of the values of the two companies through synergy. That is possible because the newly formed entity uses the expertise in different areas from both the companies involved in the merger. A merger reduces employees cost, improves market reach and expertise levels.
Due diligence review for M&A
The process of investigation or review of the proposed transaction, therefore, assumes significance and should be done with due care to understand all the aspects including, inter alia, the regulatory environment, business and economic considerations and most critical of all, the integration challenges.
One of the ways to do this is to undertake a detailed project review, commonly known as a due diligence review (DDR). As the words indicate, this is a review which has to be done with due care, with attention paid to detail. A DDR can be undertaken in a variety of areas—financial, technical and legal, to name a few. In a financial due diligence review, the historic financials can be reviewed to understand past performance in the business. Future forecasts can be studied with a view to understanding how revenue projections have been calculated, and whether all costs, (capital as well as revenue) have been captured.
adv. rajeev ( rajoo )
(Expert) 10 November 2009
mERGER: mEANS TO JOIN TOGETHER. eG: The two comnies have merged; the firm merged with its main competitior.
Joining of a small estate to large.
Joiningtogether of two or more companies, as a result of the merger, it will become the larger.
Acquire : Means to have the possession. Eg., acquisition by the govt., for the publicbenefit, it is also known as acquistition.
Take Over : Usually this take over word is used the business line take over of firm, company etc., take over means to have the ownership and control over the company or firm for consideration.
Compromise Means ; it is an agreement between two parties to settle the matter amicably.
If you to
By purchasing the shares of the company it can be take over by another company.
Before the going thru., all these process you have to verify the related documents i f it is immovable property. if the business you want then you will have to verify the statement of accounts etc., it helps know the networth of the company.
