4. BUSINESS ALLIANCES
• Mergers and acquisitions are becoming
a growing trend for companies.
•Diversifying and expanding techniques
such as mergers and acquisitions are a
very popular methods for forming these
alliances
5. •A merger is a joining of forces and an
acquisition is a purchase of a company.
• Both large and small, domestic and
foreign businesses, form strategic
alliances within their particular industries.
6. Need for alliances
• Achieve specific goals
•To keep up with a rapidly increasing
diversified global market
• Fast profitable growth
• To go international
• To become multi- technological
7. KINDS OF ALLIANCES
• Joint ventures
• Minority holdings
• Research and marketing compacts
• Cross – licensing
• Exchange of knowledge agreements
• syndicates
8. The only way
• Alliance is the only way to obtain new , distinct
and foreign technology.
• Alliances are also the way to get access to
people with the know-how.
• Alliances of all kinds are becoming
increasingly common, especially in international
business.
9. LIMITATIONS
• Goals and objectives of partners are not
compatible.
• When no mechanism to resolve disagreements.
10. PROBLEM PREVENTIO
• Before the alliance in completed , all parties must
think through their objectives and the objectives of
the child.
• The objective must be revised every 3-5 years
for every joint enterprise and more often if the
enterprise does well.
• Advance agreement on how the joint enterprise
should run.
11. •Careful thinking about who will manage the
alliance.
•Each partner needs to make provisions in its
own structure for the relationship to the joint
enterprise and the other partner.
• There has to be prior agreement on how to
resolve disagreements.