FINANCIAL MANAGEMENT(LL)-TEXT
16th Edition
ISBN: 9781337902618
Author: Brigham
Publisher: CENGAGE L
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Question
Chapter 22, Problem 2Q
a.
Summary Introduction
To determine:
Significance of merger with regard to likelihood of governmental intervention
b.
Summary Introduction
To determine:
Significance of merger with regard to possibilities for operating synergy
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Four economic classifications of mergers are (1) horizontal, (2) vertical, (3) conglomerate,and (4) congeneric. Explain the significance of these terms in merger analysis with regard to(a) the likelihood of governmental intervention and (b) possibilities for operating synergy.
“Reasons for merger that will result in wealth maximization are strategic benefits, market power, economics of scale, economies of vertical integration and taxation benefits”.
Describe how any four out of the five factors mentioned may contribute to the success of a merger business exercise
What are horizontal, vertical, congeneric, andconglomerate mergers? Are the different typesof mergers equally likely to pass muster with theJustice Department?
Chapter 22 Solutions
FINANCIAL MANAGEMENT(LL)-TEXT
Ch. 22 - Prob. 1QCh. 22 - Prob. 2QCh. 22 - Prob. 3QCh. 22 - Prob. 4QCh. 22 - Prob. 5QCh. 22 - Prob. 1PCh. 22 - Prob. 2PCh. 22 - Prob. 3PCh. 22 - Hasting Corporation is interested in acquiring...Ch. 22 - Prob. 5P
Ch. 22 - Prob. 6PCh. 22 - Prob. 7SPCh. 22 - Prob. 1MCCh. 22 - Hager’s Home Repair Company, a regional hardware...Ch. 22 - Hager’s Home Repair Company, a regional hardware...Ch. 22 - Hager’s Home Repair Company, a regional hardware...Ch. 22 - Prob. 5MCCh. 22 - Prob. 6MCCh. 22 - Prob. 7MCCh. 22 - Prob. 8MCCh. 22 - Prob. 9MCCh. 22 - Prob. 10MCCh. 22 - Prob. 11MCCh. 22 - Prob. 12MC
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- Examine what the empirical evidence say about who actually gains in a merger combinations.arrow_forwardDefine each of the following terms:b. Horizontal merger; vertical merger; congeneric merger; conglomeratemergerarrow_forwardDefine each of the following terms:c. Friendly merger; hostile merger; defensive merger; tender offer; targetcompany; breakup value; acquiring companyarrow_forward
- Discuss the underlying theories and empirical evidence on the value creation from horizontal mergers. How do other firm- and deal- characteristics interact with the valuation effects of such mergers?arrow_forwardSeveral reasons have been proposed to justify mergers. Among the more prominent are (1) tax consideration, (2) risk reduction, (3) control, (4) purchase of assets at below replacement cost, and (5) synergy in general. Which of the reasons are economically justifiable? Which are not? Which fit the situation at hand? Explain.arrow_forwardWhat is a merger? Discuss if it is an effective strategy or not.arrow_forward
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