Ingenieria

Mergers
Mergers are business combination transactions involving the combination of two or more companies into a single entity.
Refers to the aspect of corporate strategy of and combining of different companies and similar entities that can 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 orusing a joint venture.

Merger waves
The economic history has been divided into Merger Waves based on the merger activities in the business world as:

Horizontal merger: is a business consolidation that occurs between firms who operate in the same space, often as competitors offering the same good or service.

Vertical merger: a merger between two companies producing different goods orservices for one specific finished product.

Diversified conglomerate merger: a merger between firms that are involved in totally unrelated business activities.

Congeneric Merger: a type of merger where two companies are in the same or related industries but do not offer the same products.

Hostile takeovers: the acquisition of one company (target company) by another (acquirer) that isaccomplished not by coming to an agreement with the target company's management, but by going directly to the company’s shareholders or fighting to replace management in order to get the acquisition approved.

Period | Name | Facet |
1897–1904 | First Wave | Horizontal mergers |
1916–1929 | Second Wave | Vertical mergers |
1965–1969 | Third Wave | Diversified conglomerate mergers |
1981–1989 |Fourth Wave | Congeneric mergers; Hostile takeovers; Corporate Raiding |
1992–2000 | Fifth Wave | Cross-border mergers |
2003–2008 | Sixth Wave | Shareholder Activism, Private Equity, LBO |

Takeover
A corporate action where an acquiring company makes a bid for an acquire. If the target company is publicly traded, the acquiring company will make an offer for the outstanding shares.

Typesof takeover

Friendly takeovers:
Before a bidder makes an offer for another company, it usually first informs the company's board of directors. In an ideal world, if the board feels that accepting the offer serves shareholders better than rejecting it, it recommends the shareholders accept the offer.
In a private company, because the shareholders and the board are usually the same people orclosely connected with one another, private acquisitions are usually friendly.

Hostile takeovers
A hostile takeover allows a suitor to take over a target company whose management is unwilling to agree to a merger or takeover. A takeover is considered "hostile" if the target company's board rejects the offer, but the bidder continues to pursue it, or the bidder makes the offer directly afterhaving announced its firm intention to make an offer.

Reverse takeovers
A reverse takeover is a type of takeover where a private company acquires a public company. This is usually done at the instigation of the larger, private company, the purpose being for the private company to effectively float itself while avoiding some of the expense and time involved in a conventional IPO.

Backfliptakeovers
A backflip takeover is any sort of takeover in which the acquiring company turns itself into a subsidiary of the purchased company. This type of takeover rarely occurs.

Pros and cons of takeover
While pros and cons of a takeover differ from case to case, there are a few worth mentioning.
Pros:
1. Increase in sales/revenues (Procter & Gamble takeover of Gillette)
2.Venture into new businesses and markets
3. Profitability of target company
4. Increase market share
5. Decrease competition (from the perspective of the acquiring company)
6. Reduction of overcapacity in the industry
7. Enlarge brand portfolio (e.g. L'Oréal's takeover of Bodyshop)

Cons:
1. Goodwill often paid in excess for the acquisition.
2. Reduced...