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Current events ppt 2

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Mergers and Acquisitions …

Mergers and Acquisitions


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  • 1. Current Events 2 Mergers and Acquisitions Takeovers
  • 2. So last time…
    • We discussed change in leadership and how that is not always a bad thing
    • So now we’re talking about a change in the company itself!!!!!!!!!!!
  • 3. Mergers and Acquisitions Big words for changes in the companies
  • 4. What are they?
    • Merger: When 2 companies combine to form a new company
    • Acquisition: When one company buys out another company to make themselves bigger
  • 5. Lets look at a Merger!
    • United Airlines and Continental
    • http://www.guardian.co.uk/business/2010/sep/17/united-continental-merger-agreement
    • So both are working together to make more revenue and capture more of the market
  • 6. Pros and Cons
    • Helps capture a bigger section of the market
    • Get to use each company’s advantages to benefit
    • Employees may have to be let go
    • Finance may have to be combined which is an issue when dealing with debt
  • 7. Let’s look at an Acquisition
    • Pfizer buys King?
    • http://www.bloomberg.com/news/2010-10-12/pfizer-agrees-to-purchase-king-pharmaceuticals-for-3-6-billion-in-cash.html
    • One is buying the other out, so really only helps the one company
  • 8. Pros and Cons
    • Helps company taking over to expand
    • Keeps the company being taken over out of bankruptcy
    • Once again, jobs at risk, even CEOs of King aren’t guaranteed jobs
    • Might not be approved by government which is trying to stop monopolies
  • 9. So… how does this affect Stock Price? Well, let’s see…
  • 10. You tell me
    • Go to finance.yahoo.com
    • Look at the following tickers
      • UAL – United Continental Holdings (check to see how it’s doing after the merger)
      • PFE – Pfizer
      • KG – King Pharmaceuticals
    • Observe them a while, and lets see how the stocks change based on the new events
  • 11. You tell me #2
    • Look in the news for investor predictions
    • Check to see what they are saying and more importantly why they are saying it
    Hahaha!!!! Gotcha!!!!
  • 12. The End Come back next meeting with your conclusions!