Your SlideShare is downloading. ×
  • Like
Mergers And Takeovers
Upcoming SlideShare
Loading in...5

Thanks for flagging this SlideShare!

Oops! An error has occurred.


Now you can save presentations on your phone or tablet

Available for both IPhone and Android

Text the download link to your phone

Standard text messaging rates apply

Mergers And Takeovers

Mergers And Takeovers

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
No Downloads


Total Views
On SlideShare
From Embeds
Number of Embeds



Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

    No notes for slide


  • 1. Mergers and Takeovers BTEC Business
  • 2. Mergers
    • When two companies join to form one new firm, it can be:
    • voluntary, also known as a ‘merger’
    • or
    • forced, when it is known as a ‘takeover’
  • 3. Mergers
    • Merger activity is an example of ‘integration’ taking place within industries. This can be:
    • vertical integration, where firms at different stages in the production chain merge
    • and
    • horizontal integration, where competing firms in the same industry merge
  • 4. Why Integrate?
    • Firms are sometimes keen to merge when:
    • they can make savings from being bigger
    • this is known as gaining ‘economies of scale’
    • they can compete with larger firms or eliminate competition
    • they can spread production over a larger range of products or services
  • 5. Economies of Scale
    • There are several types of economy of scale:
    • technical economies, when producing the good by using expensive machinery intensively
    • managerial economies, by employing specialist managers
    • financial economies, by borrowing at lower rates of interest
  • 6. Economies of Scale
    • commercial economies, by buying materials in bulk
    • marketing economies, spreading the cost of advertising and promotion
    • research and development economies, from developing better products
  • 7. Economies of Scale
    • There are sometimes problems that can affect integrated firms. These are known as ‘diseconomies of scale’
    • firms are too big to operate effectively
    • decisions take too long to make
    • poor communication occurs