Acquisitions can be either friendly or hostile. Friendly acquisitions occur when the target firm expresses its agreement to be acquired, whereas hostile acquisitions don't have the same agreement from the target firm and the acquiring firm needs to actively purchase large stakes of the target company in order to have a majority stake.In either case, the acquiring company often offers a premium on the market price of the target company's shares in order to entice shareholders to sell.
To extend its Global reach through TATA.To get access to Indian Ore reserves, as well as virgin market for steel.To get access to low cost materials.Saturated market of Europe.Decline in market share and profit.
The combining of two or more companies, generally by offering the
stockholders of one company securities in the acquiring company in exchange
for the surrender of their stock.
Acquiring company is a single existing company that purchases the majority
of equity shares of one or more companies.
Acquired companies are those companies that surrender the majority of
their equity shares to an acquiring company.
Merger is a technique of business growth. It is not treated as a business
Merger is done on a permanent basis. Generally, it is done between two
companies. However, it can also be done among more than two companies.
During merger, an acquiring company and acquired companies come together
to decide and execute a merger agreement between them.
After merger, acquiring company survives whereas acquired companies do not
survive anymore, and they cease (stop) to exist.
Merger does not result in the formation of a new company. The management
of acquiring company continues to lead (direct) the merger.
A corporate action in which a company buys most, if not all,
of the target company's ownership stakes in order to assume
control of the target firm. Acquisitions are often made as
part of a company's growth strategy whereby it is more
beneficial to take over an existing firm's operations and
niche compared to expanding on its own. Acquisitions are
often paid in cash, the acquiring company's stock or a
combination of both.
Types of Mergers
Economists distinguish between three types of
A horizontal merger results in the consolidation of firms that are direct
rivals—that is, sell substitutable products within overlapping geographic
Examples: Boeing-McDonnell Douglas; Staples-Office Depot(unconsummated);
Chase Manhattan-Chemical Bank; Southern Pacific RR-Sante Fe RR; Pabst-
Blatz; LTV-Republic Steel; Konishiroku Photo-Minolta.
Examples: Time Warner-TBS; Disney-ABC Capitol Cities; Cleveland Cliffs
Iron-Detroit Steel; Brown Shoe-Kinney, Ford-Bendix.
The merger of firms that have actual or potential buyer-seller relationships
Consolidated firms may sell related products, share marketing
and distribution channels and perhaps production processes; or they
may be wholly unrelated.
•Product extension conglomerate mergers involve firms that sell non-competing
products use related marketing channels of production processes.
Examples: Cardinal Healthcare-Allegiance; AOL-Time Warner; Phillip Morris-
Kraft; Citicorp-Travelers Insurance; Pepsico-Pizza Hut; Proctor & Gamble-
•Market extension conglomerate mergers join together firms that sell competing
products in separate geographic markets.
Examples: Scripps Howard Publishing—Knoxville News Sentinel; Time Warner-
TCI; Morrison Supermarkets-Safeway; SBC Communications-Pacific Telesis
•A pure conglomerate merger unites firms that have no obvious relationship of any
Examples: Bank Corp of America-Hughes Electronics ;R.J. Reynolds-Burmah Oil
& Gas; AT&T-Hartford Insurance
TYPES OF ACQUISITIONS
Acquiree is or isn‘t listed in public markets.
How the communication is done and received by the target.
THE FIRST CLASSIFICATION
PUBLIC (IF ACQUIREE LISTED IN
PRIVATE (IF ACQUIREE NOT
LISTED IN PUBLIC MARKETS
THE SECOND CLASSIFICATION
Companies cooperate in negotiations.
Synonymous to merger of equals.
Takeover target unwilling to be purchased.
It can also be if the acquiree company has no
prior knowledge of offer.
Hostile takeovers do turn friendly in the end.
Most of the times.
For the above thing to happen, offer is usually
Advantages of M&A
• From the standpoint of shareholders
(a)Realization of monopoly profits;
(b)Economies of scales;
(c)Diversification of product line;
(d)Acquisition of human assets and other resources not available
(e)Better investment opportunity in combinations
• From the standpoint of managers
If Merger of two companies guarantee better deals for the managers
in terms of perks, fringe benefits as well as raising their status in the
company will not only satisfy the managers but resulting company
also gets support from these managers.
• Promoter‟s gains
Mergers do offer to company promoters the advantage of
increasing the size of their company, the financial structure
and strength. They can convert a closely held and private
limited company into a public company without contributing
much wealth and without losing control.
• Benefits to Consumers- Lower prices and better quality of the
product which directly raise their standard of living and quality
SYNERGIES RELATED TO M&A
• Economies of Scale- Mergers also translate into improved purchasing power to
buy equipment or office supplies - when placing larger orders, companies have a
greater ability to negotiate prices with their suppliers.
• Staff reductions- The money saved from reducing the number of staff members
from accounting, marketing and other departments. Job cuts will also include
the former CEO, who typically leaves with a compensation package.
• Acquiring new technology- To stay competitive, companies need to stay on top
of technological developments and their business applications.
• Improved market reach and industry visibility- Companies buy companies to
reach new markets and grow revenues and earnings. A merge may expand two
companies' marketing and distribution, giving them new sales opportunities.
Costs associated with Mergers and Acquisitions
Cultural mismatches : Every company is shaped by the vision and background
of its promoters or management. This is called 'company culture' - the way they
project themselves in the market place, how they treat customers, employees,
suppliers and shareholders
Redundancy : there may be employees who duplicate each other‘s functions.
This can cause excessive payroll expenditures where you pay for two
employees to do the work of one. That can reduce motivation among
Increased Debt : Money borrowed to acquire a company along with debt
servicing. Many a times a company becomes target of acquisitions because they
are struggling financially. Ultimately the financial burden is passed on to
Market saturation : If you acquire a company that is in the same line of
business as your original company, your hopes for market expansion may hit a
barrier: the two companies together already dominate the market.
Immediate negative effect on the share prices : Reverse takeovers, when a
smaller company acquires a larger one, are even worse when the prices paid are
high and timings are wrong. Lower share prices and equity valuations may also
arise from the merger itself being a short-term disadvantage to the company.
Opportunity Cost : M&A activity can also be exacerbated by the short-term cost of
opportunity or opportunity cost. This is the cost incurred when the same amount of
investment could be placed elsewhere for a higher financial return
Consumer and shareholder drawbacks
In some cases, mergers and acquisitions may not only disadvantage the shareholders
but consumers as well. In both cases, this may happen when the newly formed
company becomes a large oligopoly or monopoly.
Increase in cost to consumers
Decreased corporate performance and/or services
Potentially lowered industry innovation
Suppression of competing businesses
Decline in equity pricing and investment value
The global Steel industry
―I really believe that the owners of iron ore are going to rule the industry. They will be OPEC of the
steel industry.‖ (Ratan Tata‘s interview to McKinsey Quarterly quoted by Wheatley in Financial Times,
January 29, 2007).
In recent years, the steel industry witnessed a high degree of global consolidation due to a few
• A desire amongst the key players to gain efficiencies resulting from scale,
• Obtaining access to new and growing markets,
• Enhancing purchasing power with respect to suppliers and buyers.
The climate at the time of Tata‟s acquisition of Corus was characterized by an “eat-or-be-eaten”
mentality in which steel companies increasingly had to decide whether to be an acquirer or an
acquisition target. These mergers and acquisitions were expected to eventually result in a
handful of worldwide global giants in the steel industry. Merger and acquisition activity in the
world steel industry was likely to result in a higher degree of pricing stability and better margins
for the steel producing companies.
Until the 1990s, not many Indian companies had
contemplated spreading their wings abroad. An
Indian corporate or group company acquiring a
business in Europe or the U.K. seemed possible only
in the realm of fantasy.
Background of TATA Steel
A part of TATA Group of Company’s.
Formerly known as TISCO and TATA IRON AND STEEL
Located in Jamshedpur, Jharkhand, India.
World’s 7th largest steel company.
India’s 2nd largest and 2nd most profitable private sector company.
Data as per March 31, 2008
Capacity = 31 million tones
Revenues = 132,110 crore
Net profit = 12,350 crore
One of the largest steel companies in Europe.
Came into being in 1999 with the merger of British Steel plc and
Also has a presence in The Netherlands, Germany, France,
Belgium, the United States, and Canada.
The company manufactures, processes, and distributes metals
products to the construction, automotive, mechanical engineering,
packaging, and other markets.
What was the deal?
Tata acquired Corus, which is four times larger than its size and the largest steel producer in the
U.K. The deal, which creates the world's fifth-largest steelmaker, is India's largest ever foreign
takeover and follows Mittal Steel's $31 billion acquisition of rival Arcelor in the same year.
Tata acquired Corus on the 2nd of April 2007 for a price of $12 billion. The price per share was
608 pence(rs 484), which is 33.6% higher than the first offer which was 455 pence.
What was the deal?
Payment Proposal – A Series of Events
Mid-2006- Ratan Tata made an offer of 455p per share to buy Corus
10/17/06 - Tata Steel makes a cash offer of 5.1billion pounds ($10 billion) bid for Corus worth 455p a share in cash.
10/20/06 - Corus’s Board of Directors recommend acceptance of Tata Steel’s offer.
11/17/06 - Companhia Siderurgica Nacional (CSN) of Brazil makes a bid of GBP 5.3 billion for Corus, worth 475p a share
12/10/06 - Tata Steel raises its offer by 10 per cent and makes an offer of GBP 5.5 billion including debt, worth 500p a
share in cash.
12/11/06 CSN - raises its formal offer for Corus from 500p to 515p a share in cash
1/21/07 - Corus accepts a 515 pence per share offer fromCSN
1/27/07 - Tata Steel and CSN agreed to terms for an auction that will begin January 30 at 4:30 p.m. There will be up to
nine rounds of bidding.
1/31/07 - The “battle for Corus” starts.
2/1/07- After three months of bids and counter-bids, Tata Steel wins. Tata Steel acquires 21.1 percent of the equity share
capital for 608 pence per share
It was a CASH DEAL because-
Immediate takeover was required.
Share Swap deal would have been less attractive to the Corus shareholders.
Share Swap would have meant FDI and that brings a lot of regulatory hassles which might not have been
accepted by Corus shareholders.
Share Swap would have diluted Tata Steel’s Equity base which was not in favor of Tata shareholders.
And moreover cost of equity at around 15% is higher than that of debt of around 8%, so paying in cash brings
down the cost of acquisition.
Equity + Loan = Deal
$3.95 + ($3.654 + $2.233 + $2.233) = $12.07
Rationale of deal
To tap mature European market.
Helped TATA to feature in Top 10 players in
Corus holds number of patents and R&D facilities.
Cost of acquisition is lower than setting up of
Green field plant & marketing and distribution
TATA manufactures Low Value, long and flat steel
products ,while Corus produce High Value Stripped
To extend its Global reach through
To get access to Indian Ore reserves, as
well as virgin market for steel.
To get access to low cost materials.
Saturated market of Europe.
Decline in market share and profit
Synergies expected from the deal
Tata was one of the lowest cost steel producers & Corus was fighting to keep
its productions costs under control.
Tata had a strong retail and distribution network in India and SE Asia. Hence
there would be a powerful combination of high quality developed and low cost
high growth markets
Technology transfer and cross-fertilization of R&D capabilities.
There was a strong culture fit between the two organizations both of which
highly emphasized on continuous improvement and Ethics.
Economies of Scale.
Increase in profitability.
Backward integration for Corus and Forward integration for Tata Steel.
BENEFITS TO TATA STEEL
Lowest cost producer in
Experience of TATA
group in doing global
Stable balance sheet
(Low Debt to Equity
Corus was triple the size
of TATA steel in terms of
Consolidation trend in
CSN’s lost image after
failure of 2002
To get exposed to
global steel market
Brazil company CSN
No committed financers
to support the possible
Between the two companies there exists a high degree of cultural
compatibility which would facilitate an effective integration of the
businesses over time.
Enhanced scale will position the combined group as the fifth largest
steel company in the world by production, with a meaningful
presence in both Europe and Asia.
Powerful combination of low cost upstream production in India with
the high-end downstream processing facilities of Corus will improve
the competitiveness of the European operations
Facilitates cross-fertilization of research and development capabilities in the
automotive, packaging and construction sectors and there will be a transfer,
from Europe to India, of technology, best practices and expertise of senior
Increased demand for steel specially in developing countries
for growing sectors like Infrastructure, construction,
automobiles and consumer durables.
The Investment demand was strong and rising with subsequent rises in the in
steel prices. (In August 2009, the index for basic metals has recorded growth
rate of 8.5% and the production has grown 7.6% compared to last year’s 6.6)
Why did CORUS sell?
Rationale behind Corus to sell to Tata :
Corus, the Anglo-Dutch steelmaker, was formed in 1999 by the merger of British Steel with
Hoogovens of the Netherlands. With 47,300 employees working in plants across Britain, the
Netherlands, Germany, France, Norway, and Belgium,
Corus had the highest cost of production among the world’s steel makers. After the merger, a rift
developed between the two camps.
Matters became worse when the British half of the business sustained serious losses while the
Dutch side was quite profitable.
The Dutch contended that the UK side of the business was causing the entire organization to be
Corus’s management realized that the status quo was unsustainable given the increased
competition from steelmakers in developing economies who had access to cheaper labor and
Additionally, higher raw material and energy costs were impacting profitability. So they decided
to look for a suitable partner outside Western Europe to acquire Corus, and began negotiations
with key players in the steel industry from India, Russia, and Brazil.
Impact on Tata
TATA Steel Group rose to 5th position from 56th
The production capacity increased from 4million tones to 28million tones
Standard & Poor‘s Rating cut it credit Rating to BB from BBB and removed
them from the negative watch list
Big boost to the Indian economy as TATA acquired a company 3 times its
The R&D Unit of Corus complements that of TATA‘s
Tata took help from financing institutions as $8 billion was raised through
Corus‟ EBITDA was at 8% which was much lower as compared to Tata
Tata‘s debt equity ratio was adversely affected to 2.74:1 from 1.1 which it
was maintaining earlier.
Post Acquisition View
TATA steel acquisition of CORUS was a bold and smart
move. Complementarities in scale, market geography,
financials, technology and raw materials offered a
strong rationale for the deal.
The acquisition of CORUS has been timely. Given the
rising momentum of consolidation in the industry and
rising valuations of steel companies, had TATA steel not
acted when it did, the opportunity could have been lost
On Share Prices
Tata steel stock price post merger in Indian stock markets
Tata Steel‘s performance after acquisition
FY 06-07 FY 07-08 FY 08-09
Debt to Equity Current ratio
Post Acquisition company situation
2007 2008 2009 2010
Return on Capital employed (%)
Interest coverage ratio based on capital
2007 2008 2009 2010 2011 2012
Scenario after merger..
Glory at a cost
In 2007, when Tata Steel acquired Corus, an Anglo-Dutch company, for $12.1 billion (Rs 53,460
crore), India‘s first Fortune 500 multi-national company was born. The deal made Tata Steel the
world‘s fifth-largest steel producer, with annual capacity of 25 million tonnes. The deal promised
access to high-end European markets, supported with low-cost Indian manufacturing. The company
was in fact on an acquisition spree for the earlier two years — it had acquired NatSteel in Singapore
and a 67 per cent stake in Thailand‘s Millennium Steel, applying the same logic of shipping low-cost
steel slabs to finishing plants abroad.
Corus was, however, also bought at a 34 per cent premium to Tata‘s original bid, as Brazil‘s CSN got
into the race. It was a boom time for the steel industry as well, due to rising demand from China
before the 2008 Olympics.
In comparison, Lakshmi Mittal‘s $34-bn (Rs 156,536 crore) acquisition of Arcelor in June 2006 was
cheaper, at an Ebitda (earnings before interest, tax, depreciation and amortisation) multiple of 4.3
vis-à-vis one of nine for Tata Steel‘s acquisition of Corus. Nevertheless, it was considered a ―must
deal‖ by many veterans, as the industry was going through consolidation, with leaders such as
Lakshmi Mittal looking at this process as the way to bring scale and profitability.
Crash, then crisis
Then, the 2008 subprime crisis happened. Automobile companies and
construction companies, the main sectors affected in the financial
crisis, were key customers of Corus. The company recorded a 23 per cent
decline in Ebitda for 2008-09, followed by a $303 mn (Rs 1,361 crore)
operating loss in 2009-10.
This was attributed to a significant decline in European demand and
continuation of production at the loss-making Teesside Cast Products unit in
the UK. A consortium of four customers pulled out of a 10-year purchase
contract with Corus, leading to a loss of nearly 1,500 jobs. The contract
had helped the company sell nearly 80 per cent of the plant‘s total output.
―There is nothing new to the cyclical nature of steel business,‖ said Vikas
Kaushal, partner at global management consultancy firm A T Kearney. ―A
company‘s strategy for scale and footprint should not be undermined with
every decline in the cycle.‖
Corus undertook two major cost saving initiatives in the second half of 2008-09. Total
savings in 2009-10, with both the programmes, were Rs 6,800 crore. The company came
back into the black in the second quarter of 2010-11, on the back of improved economic
sentiment and demand for the alloy, as governments in the US and Europe increased
spending. The company reported operating profit of Rs 886 crore for the quarter and
renamed Corus as Tata Steel Europe. It also agreed to sell the beleaguered Teesside plant to
Thailand‘s Sahaviriya Steel Industries, for Rs 2,242 crore.
The refinancing of about Rs 24,700 crore of term loans and revolving credit facilities was
also completed. This pushed the repayment by three to four years, besides giving additional
flexibility to borrow for working capital purposes and to incur capital expenditure.
Following this, the company reported Rs 4,111 crore Ebitda for 2010-11 and Rs 1,775 crore
The European debt crisis again proved a drag on Tata Steel‘s consolidated performance. On
a standalone basis, it reported Rs 2,669 crore Ebitda for the quarter ending
September, compared with Rs 2,779 crore in the year-earlier period.
Sales in India rose 13 per cent to Rs 9,034 crore, while sales volume grew five per cent to
"European steel demand and prices have weakened since the spring and this took its toll on
our financial performance," said Köhler while announcing the quarterly result. "Our response
has been to accelerate our efforts to reduce those costs that we can influence."
Obviously, analysts feel domestic operations will continue to play their role and give back-
end support to the overall performance. ―We do not anticipate significant improvement in
the company‘s financials in the near term,‖ said Umesh Patel, analyst with Mumbai-based
domestic brokerage K R Choksey.
A Marriage Made In Heaven
An Incompatible Marriage
The Perfect Union
Deal of The Century
A merger of ‗equals‘
Overview of the Auto Industry
Largest manufacturing industry
High barriers to entry
Highly consolidated industry
Trends in the Auto Industry
Lean and green production
Background of Daimler AG
Daimler-Benz AG founded in 1926 by
Gottlieb Daimler and Carl Benz.
Business Divisions: Mercedes-Benz
Cars, Daimler Trucks, Daimler Financial
Services, Daimler Buses, Mercedes-Benz
Today is the 2nd of the Big Three European
Automakers (Volkswagen, Daimler
Background of Chrysler
Founded by Walter P. Chrysler on June 6, 1925.
Business Divisions: Chrysler, Dodge, ENVI, Jeep, Global
Electric Motorcars (GEMCAR), Mopar, Chrysler Financial.
In 1928, Acquisition of the Dodge Brothers firm made
Chrysler the third of Detroit’s “Big Three”
(GM, Ford, Chrysler) automakers overnight.
Daimler-Benz and Chrysler Corporation‘s
strengths in 1998
Mercedes is the most popular luxury brand
A strong dealer network
Ranked #17 globally
Low-end/sub-compact cars and trucks
Big auto manufacturer in North America
Mini-vans, Jeep and Dodge trucks
Ranked #25 globally
Motivations for Mergers (Expected Synergies)
- Entry into U.S domestic market
- European presence
Daimler & Chrysler
- Match made in heaven
To leverage on each other’s strengths.
Improving shareholder’s return.
Reducing the overall effective global competition.
Purchasing, distribution, Research & Development.
In May, 1998, Daimler-Benz and Chrysler Corporation, two of
the world's leading car manufacturers, agreed to combine
their businesses in what they claimed to be a ―merger of
On May 7th, 1998, Eaton, CEO Chrysler, announced that
Chrysler would merge with Daimler-Benz, resulting in a $37
billion stock-swap deal.
The merger resulted in a large automobile company, ranked
third in the world in terms of revenues, market capitalization
and earnings, and fifth in the number of units sold.
The new company, with 442,000 employees and a market
capitalization approaching $100 billion, would take advantage
of synergy savings in retail
sales, purchasing, distribution, product design, and research
The Merger of „Equals‟
Structure of the transaction
• 1 Daimler = 1 Daimler Chrysler ( DCX)
• 0.45 Chrysler Corporation = 1 Daimler Chrysler ( DCX)
Deal closed in 200 days
• May 6, 1998, merger agreement is signed
• 17th November the stock starts trading
First global share
• 21 markets all over the world
• DCX was no longer a part of S&P 500
The companies expect to realize cost savings of $1.4 billion in the
first year after the merger and $3 billion in savings over the next
Executives said no layoffs or plant closings are planned.
The company will have headquarters in Germany and Michigan
but it will be incorporated in Germany and have a traditional
German structure with separate supervisory and management
The combined company would have $92 billion in market value
and an estimated $130 billion in annual revenue, still below
Chrysler's two U.S. rivals, Ford Motor Co. and General Motors
Corp., and just behind Japan's Toyota Motor Corp. and
Germany's Volkswagen AG as the fifth-largest automaker in the
Following the alliance…
Daimler-Chrysler post merger performance
"The first full year of DaimlerChrysler had been a great
Their sales revenues for 1999 are up about 12 %. They
sold 3 .2 million Chrysler, Dodge, Plymouth, and Jeep
products - more than any other year history.
They also sold more than a million Mercedes-Benz
passenger cars, and 550,000 commercial vehicles - also a
But as we all know that Not All
Marriages are Made in Heaven.
When Chrysler performed badly in 2000, its American president, James P
Holden, was replaced with Dieter Zetsche from Germany.
A few senior Chrysler executives had already left and more German
executives were joining Chrysler at senior positions.
In an interview to the Financial Times in early 1999, Schrempp admitted
that the ―DCX deal was never really intended to be a merger of equals‖
and claimed that ―Daimler-Benz had acquired Chrysler.‖
By the end of 2000, there were only 128,000 Chrysler employees still
working in the US operations.
Chrysler reported a third quarter loss of $512 million for the period ending
September 30, 2000; and its share value slipped below $40 from a high of
$108 in January 1999.
The expected and wished for synergy effects stayed out. Instead of
gaining competitive advantage over their competitors, the merger rushed
the two car producers ever deeper into the crisis and did not provide the
companies with the necessary tools to overcome the recession.
1. Cultural Clash
At first, the German management granted Chrysler the
freedom to do what they had always done.
Daimler-Benz wanted to simply take advantage of
But a number of Chrysler‘s key players had left the
corporation and remaining employees were demoralized
Within 19 months two American CEOs were dismissed and
German management took over.
Daimler-Benz tried to administer the Chrysler division as if
it was a German company.
From Chrysler‘s point of view, instead making use of new
synergy effects, and instead of gaining competitive
advantages over the competitors, the merger with
Daimler-Benz drove Chrysler into chaos.
Encouraged creativity Methodical decision-making
Egalitarian relations among staff Respect for authority, bureaucratic
precision, and centralized decision-making
American CEOs were rewarded handsomely Disliked huge pay disparities
Performed little paperwork and liked to keep
their meetings short
Used to lengthy reports and extended
Favoured fast-paced trial-and-error
Detailed plans and precise implementation
Flat structure Top-down management approach
Failure to inform all stakeholders accurately about the terms of the
Oct 2000, Schrempp, Daimler CEO, confessed that it was never meant to
be merger of equal – Chrysler was to be a subsidiary of Daimler-Benz.
This caused ―Deep Mutual Distrust‖.
No clear message and communication about answer to current problems
and who is going to run the entity. The German? Will facilities of
Chrysler have to close down?
DaimlerChrysler‘s communication strategy was not effective enough to
meet this challenge.
Less than 2 years, it had lost the confidence of the media and
credibility it had with US management staff and shareholders.
Soon DaimlerChrysler was referred to as acquisition rather than merger.
In May 2007, a private equity firm Cerberus Capital Management LP
bought percent of Chrysler, for billion.
Far from the $37 billion Daimler spent to acquire Chrysler back in 1998.
Not all money goes to DaimlerChrysler, the money actually goes to
paying off Chrysler's outstanding loans, ensuring the new Chrysler
Holding company begins life debt-free.
Today Daimler AG is the 2nd of the Big Three European Automakers
(Volkswagen, Daimler AG, Renault)
(in terms of production, 1998)
Rank Group Total
1 GM 7582
2 Ford 6556
3 Toyota-Daihatsu 5210
4 Volkswagen 4809
5 DailmerChrysler 4512
6 Fiat 2696
7 Nissan 2620
8 Honda 2328
9 Renault 2283
10 PSA 2247
11 Mitsubishi 1591
12 Suzuki-Maruti 1298
(in terms of production, 2012)
Rank Group Total
1 Toyota 10,104,424
2 GM 9,285,425
3 Volkswagen 9,254,742
4 Hyundai 7,126,413
5 Ford 5,595,483
6 Nissan 4,889,379
7 Honda 4,110,857
8 PSA 2,911,764
9 Suzuki 2,893,602
10 Renault 2,676,226
11 Chrysler 2,371,427
12 Daimler AG 2,195,152
Daimler AG after Demerger
Return on Assets % Return on Equity % Net Profit Margin % EBIT Margin
2008 2009 2010
When it comes to cross-border or cross-cultural M&As, the inherent
cultural differences must not be disregarded. One corporate culture
cannot simply suppress and replace the other one. A consensus has to
be reached and the foundation for a new culture, based on elements
of both cultures involved, has to be laid.
In the case of DaimlerChrysler, both parties were never truly willing to
cooperate wholeheartedly and to accept changes and to enter
compromises which was a necessity to make this merger of the two
companies a success.