Joint ventures involve two or more businesses cooperating on a specific project by sharing profits, losses, and control. They are short-term partnerships where members pool resources for a profitable venture. Mergers occur when two companies legally combine into one entity under shared management. Acquisitions happen when one company purchases a controlling stake in another and manages both under one team, which may include managers from both original companies. Mergers and acquisitions allow companies to access new resources, technologies, markets, and management strategies.

1. JOINT VENTURE/
MERGERS AND
AQUISITIONS

2. MEANING OF JOINT
VENTURE
Joint venture is the co operation of
two or more individuals or business
in which each agrees to share
profit, loss and control in a specific
enterprise.

3. FEATURES OF JOINT
VENTURE
• Joint venture is a short duration special purpose
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partnership.
Joint venture does not follow the accounting concept
'going concern'.
The members of joint venture are known as co-ventures.
Joint venture is a temporary business activity.
In joint venture, profits and losses are shared in agreed
proportion. If there is no agreement regarding the
distribution of profit, they will share profit equally.
Joint venture is an agreement for polling of capital and
business abilities to be employed in some profitable
venture.

4. INTERNAL FACTORS TO STYLE A
JV
• Spreading prices
You and JV partners can share prices associated
with advertising, product or service improvement,
and other expenditures, reducing your monetary
burden.

5. • Opening Accessibility to Fiscal
Assets:
With each other you plus a JV accomplice may have
greater credit or far more assets to obtain bigger resources
for loans and grants than you could obtain on your own.

6. • Connection to Technological Assets:
You could possibly want entry to technological assets you
couldnt afford personally, or vice versa. Sharing
progressive and proprietary engineering can increase
items, as well as your individual understanding of
technological processes.

7. • Improving Obtain to New Markets:
You and your JV partners can combine client and contacts
with each other or even create a jointproducts or services
that accesses new markets.

8. EXTERNAL FACTORS TO STYLE A
JV
• Develop Stronger Innovative Solution:
With each other you and also a JV companion may be able
to share suggestions to produce a product thats a lot more
competitive within your industry.

9. • Increase Speed to Market place:
With shared entry to economic, technological, and
distribution means, you along with a JV accomplicecan get
your joint item into the market place quicker and a lot more
efficient.

10. ADVANTAGES
• Accessing additional financial resources:
• Sharing the economic risk with co-venturer
• Widening economic scope fast
• Tapping newer methods, technology, and approach you
do not have
• Building relationship with vital contacts

11. DISADVANTAGES
• Shared profit – Since you share assets, you also share the
profit.
• Diminished control over some important matters - Operational
control and decision making are sometimes compromised in
joint ventures.
• Undesired outcome of the quality of the product or project.
• Uncontrolled or unmonitored increase in the operating cost

13. MERGERS
Mergers happen when two companies agree to legally
combine into one company, melding their management.

14. AQUISITIONS
• Mergers and acquisitions are often confused. An
acquisition involves one company buying a controlling
interest in the stock of another company and managing
both companies under one management team, which
might consist of a mix of managers from both companies
or only the managers from the surviving company.

15. MERGER
COMPANY A
COMPANY B
Company A and Company B
together form the new
Company C
ACQUISITION
COMPANY A
COMPANY B
Company A buys Company B
Company A

16. TYPES OF MERGERS
• Horizontal mergers: It takes place when the two organizations
producing a similar product combine. E.g.: GAP Inc. control three distinct
companies, Banana Republic, Old Navy and the GAP itself.
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Vertical Mergers: It takes place when the two organizations working at
different stages in the production of the same product, combine. E.g.: Carnegie
Steel company, it control the mill, iron ore mines, coal mines, the ships, the rail
roads, the coke ovens.
• Conglomerate Mergers: It takes place when two organizations
operate in different industries. A conglomerate is a large company that consists of
divisions of often seemingly unrelated business. E.g.: Tata group, Reliance
Industries etc.

17. TYPES OF ACQUISITION
• Friendly Acquisition: In this generally poorly performing organization’s board od
directors willingly sells its shares to the acquiring organization.
• Hostile acquisition: In this generally poorly performing organization’s board of
directors opposes to sell of the company. In this situation the acquiring
organization has two options:
1.
A tender offer: It represents an offer to buy the stock of the target
organization either directly from the shareholders or through secondary
market.
2.
Proxy fight: the acquirer solicits the shareholders of the target organization in
an attempt to obtain the right to vote their shares. The acquiring organization
hopes to secure enough proxies to gain control of the board of directors and in
turn replace the incumbent management.

18. MOTIVES BEHIND M AND AS
• To provide improved capacity utilization
• To provide better use of the existing sales force
• To reduce managerial staff
• To gain economies of scale
• To smooth out seasonal trends in sales
• To gain access to new suppliers, distributors, customers,
products and creditors
• To gain new technology
• To reduce tax obligations

19. REASONS FOR FAILURE OF
MERGERS
• Undue focus on financial aspects– valuing assets, determining the price and due
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diligence at the cost of human factor.
Line employees and managers at all level lose personal effectiveness as a result
of rumors, misinformation and worry.
Infrequent and irrelevant communication adds to the problem.
Without clear lines of authority and a clear understanding of where they fit in,
employees and managers are often caught in a web of conflicting objectives and
old loyalties.
The post merger entity demands a leadership to articulate a vision and inspire
others to join in that vision. But the stress and uncertainties associate with the
merger make the leader focus inwards and play safe.

20. DIFFERENCES
MERGER:
• Merging of two organization into one.
• It is the mutual decision.
• Merger is expensive than hostile
takeover.
• Through merger shareholders than
merger. can increase their net worth.
• It is time consuming and the company
has to maintain so much legal issues.
• Dilution of ownership occurs in merger
ACQUISITIONS:
• Buying one organization by another.
• It can be friendly take over or a hostile
takeover.
• Acquisition is less expensive than
merger.
• Buyers cannot raise their enough
capital.
• It is faster and easier transaction.
• The acquirer does not experience the
dilution of ownership

21. MERGERS AND ACQUISITION DEALS