A presentation on the concept of M&A(s),the causes and reasons for the rise in the same in the Indian Economy.

1. .
SIES (NERUL) COLLEGE OF ARTS,SCIENCE AND COMMERCE

2.  Merger and acquisition (M&A) is the consolidation of companies
or assets.
 Mergers and acquisitions are two forms of corporate
restructuring.
 It creates a synergy in the organization. Higher the synergy,
higher is the competitiveness and efficiency of the new firm.
 Post merger ,some companies find great success & growth ,while
some fail to reach their expectations.

3. .
MERGERS AND
ACQUISITIONS
‘A’ and ‘B’ are two
companies consolidated into
one new company ‘C’
Merger involves formation of
a new company by joining of
2/more existing companies.
•Here, company A buys/takes
over company B and retains its
original identity
•Acquisitions occur when one
company buys enough equity in
another to become its owner.

4.  Horizontal merger
 Vertical merger
 Market-extension merger
 Product-extension merger

5.  Horizontal acquisition
 Vertical acquisition
 Conglomerate acquisition
 Congeneric acquisition

6. • .
VERTICAL MERGER MARKET EXTENSION MERGER
CONGLOMERATE MERGER
HORIZONTAL MERGER
CONGENERIC MERGER

7. MAJOR
REASONS
1)To Create
Growth
2)To Improve
Performance
3)To Remove
Excess
4) Cutting
costs
5) Surviving
6) Eliminate
Competition
7) Other
Reasons
WHY IS IT DONE
BY COMPANIES?

8. • There is always synergy value created by the joining or merger
of two companies.
• The synergy value can be seen either through the Revenues
(higher revenues), Expenses (lowering of expenses) or the cost
of capital (lowering of overall cost of capital).
PRINCIPLE BEHIND
ANY M&A

9. .
Poor strategic fit
Poorly managed Integration
Incomplete due diligence
Overly optimistic attitude
Ex: Breakdown in
merger discussions
between IBM and Sun
Microsystems
happened due to
disagreement over
price and other terms.

11. Develop a strategy
Set the M&A search criteria
Search for potential targets
Begin planning
Perform valuation analysis

12. .
Negotiations
Purchase and sale contract
Financing strategy
Closing and Integration

13. .
Economies of scale
Improvement in R and D
Survival of Industry
Vertical Mergers

14. .
Foreign Takeovers
Diseconomies to scale
Consolidation of Market
share
Deficient Management

15. Tata
Teleservices
and Telenor
- Airtel
Axis Bank-
Freecharge
Capital
first +
IDFC bank
Bank of
Baroda +
Vijaya Bank
& Dena
Bank
Ola-
Foodpanda
Flipkart +
eBay
AND MORE!

16. • In 2018,Walmart Co. merged with Flipkart Co., for roughly
77% stake in the same. Walmart will pay $16 billion and
maintain a clear majority ownership in the company.
• Main objectives :-
 MAJOR PLAYER IN INDIAN MARKET.
 AIM TO BECOME PUBLICLY-LISTED.
 BIG 'MAKE IN INDIA' PUSH.
 LOCAL OUTSOURCING, BETTER LOGISTICS.
 MORE INVESTORS TO JOIN IN.
• This merger led to a ‘WIN WIN’ situation for both the Cos.
ABOUT- FLIPKART Co. AND WALMART Co.

17. . Aircel and Reliance shareholders approved the merger in 2017
and it was expected to be completed in the same year.
• MAIN OBJECTIVE:- Reliance Communication had a
debt of 958 crores during the time of the merger. The
synergies beneficial cost and debt reduction.
• REASONS FOR FAILURE:-
 Opposition from Creditors like Ericsson and (CDB) China Development Bank who
objected before NCLT.
 The procedure was time-consuming as a lot of permissions had to be sought from
courts and authorities like DOT.
 High taxation, the charge levied by the centre on the use of spectrum through auction.
 The deal was called off mutually by both the parties.
ABOUT- RELIANCE COMM. AND AIRCEL Co.

18. • After witnessing a downward trend in M&A activities during the year 2019, the year
2020 would bring about significant, if not better, activity.
• The regulatory framework has been enhanced with many recent announcements,
facilitating increased economic activity.
• A successful M&A strategy would be successful with an apt business strategy along
with plans to mitigate the legal/business risks will be essential.
• The EdTech space in the past few months has seen such developments
EdTech Decacorn, plans to acquire(i) WhiteHat Jr and (ii) Doubtnut, two
similar but smaller education learning apps (motive: Reach customer base
from rural areas).
• LETS HAVE A LOOK AT IMPACT OF THE PANDEMIC ON SPECIFIC SECTORS

19. .
Source: COVID-19: Impact On Mergers & Acquisitions | Accenture.com

20. KEY HIGHLIGHTS :-
• On 31st August,2018, Vodafone India merged with Idea Cellular to form a new entity named Vodafone India ltd.
• Until 7 September 2020, Vodafone Idea Limited operated two separate brands:
• In September 2020,Vodafone Idea underwent rebranding to be known as “Vi”.
• The merger created the largest telecom company in India by subscribers and by revenue. Under the terms of
the deal, the Vodafone Group holds a 45.2% stake and the Aditya Birla Group holds 26% and the remaining
held by the public.
• Vodafone Idea also provides services including Mobile payments, IoT, enterprise offerings and entertainment
accessible.
• As of 31 March 2020, Vodafone Idea has a subscriber base of 319.19 million, making it third largest mobile
telecommunications network in India and fifth largest mobile telecommunications network in the world.
• Vodafone Idea has a broadband network of 340,000 sites, distribution reach of 1.7 million retail outlets.
V!
Vodafone – a postpaid & Prepaid GSM service.
Idea – a prepaid GSM service, similar to Vodafone
Prepaid.

21. Source:- NDTV news
The combined company would
have 35% customer market share,
and 41% revenue market share.
As per a Bloomberg quint report ,the
merger unit will have 1120MHz
spectrum across the top 5 five brands.
Analysts sat that once the new entity is
formed, it would be better to complete
over content, and not start a new price
war.

22. 1. Sandhya G- 18
2. Pooja N- 53
3. Devesh N- 54
4. Shalini N- 58
5. Priyanka S- 80
6. Ritika S- 100
7. Smriti S- 101
8. Prasad – 103
9. Saurav M- 128
10. Poorva T- 131