About M&As

- Mergers and acquisitions get everyone's attention in any organization, large or small. Let's start by

understanding in general what M&As are and why firms pursue them. Mergers and acquisitions include

all aspects of organizations, such as, strategic management, corporate finance, human

resources, information technology, operations, legal, sales and marketing, and research and

development. M&As deal with the buying, selling, dividing and combining of companies that can help

an enterprise grow rapidly in its business sector, enter new geographies, or gain new products and

services.

Mergers and acquisitions result in some reorganization with the key goal of creating growth and

positive shareholder value. Industry consolidation happens when widespread M&A activity

concentrates the resources of many companies within a particular industry into a few larger ones, such

as we have seen in the banking, pharmaceutical and technology industries, for example. The

distinction between a merger and an acquisition has become blurred in various respects, especially

when it comes to the ultimate goal of creating shareholder value.

However, the difference has not completely disappeared in all situations. From a legal point of view, a

merger is a legal consolidation of two companies into one entity, whereas an acquisition occurs when

one company takes over another company and completely establishes itself as the new owner. Either

structure can result in at least some consolidation of the two entities' people, processes and

systems. This is why integration is so important for creating the value that is expected from mergers

or acquisitions.

So, doing M&A integration well creates that value.