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GE honeywell merger

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GE honeywell merger

  1. 1. Mergers and Acquisition GE and Honeywell: A failed merger attemptMMS FINANCE – GROUP 7 PRESENTED TO : MRS. CELINA JOY
  2. 2. GE and Honeywell : A failed merger Attempt 1 Introduction 2 GE background 3 Honeywell background 4 Proposed merger - part 1 5 Proposed Merger – part 2 6 Conclusion 7 Question – answers and discussion
  3. 3. IntroductionIntroduction to the case•Biggest merger in industrial history,  valued at over $40 billion•Deal would increase size of GE by one third.•GE was attracted by Honeywell’s aerospacebusiness.•The merger was passed by united statedepartment of justice. Presented by : Vaibhav Coming up : EC dashes merger
  4. 4. Introduction Introduction continued • July 3rd, 2001, EC dashed all the hopes of merger between GE and Honeywell. •Mario Monti’s view  Creation of strong and powerful entity together,  Huge combined market share,  Near monopoly in market. •EC’s demand & restriction. •An epic disspproved merger.Presented by : Vaibhav Coming up :GE background
  5. 5. GENRAL ELECTRIC GE Background 1872 2000’s 1892 1990’s 1894 1981 1922 1972 1940 1964 1952 Coming up :Honeywell backgroundPresented by : Ketki
  6. 6. Honeywell Company overview Coming up : Proposed MergerPresented by : Mehul
  7. 7. FINANCIALS GE & HoneyWell Gross Profit GE ($ in Millions) Revenue GE ($ in Millions) Gross Profit Honeywell ($ in Millions) Revenue Honeywell ($ in Millions) 129.853 125.913 131.698 78.03 76.816 50.128 25.023 23.652 22.274 5.933 3.223 4.659 DEC -00 DEC-01 DEC-02 DEC -00 DEC-01 DEC-02 Coming up :proposed mergerPresented by : Imran
  8. 8. FINANCIALS GE & HoneyWell Net Income for equity shareholders GE ($ in Millions) PBIT GE ($ in Millions) PBIT Honeywell ($ in Millions) Net Income for equity shareholders Honeywell ($ in Millions) 14.118 30.166 30.763 13.684 29.107 12.735 1.659 -0.099 -0.22 2.879 -0.017 -0.601 DEC -00 DEC-01 DEC-02 DEC -00 DEC-01 DEC-02 Coming up :financials continuedPresented by : Imran
  9. 9. Proposed merger - I Expected Synergies Honeywell’s businesses were a good fit with GE’s own businesses in aircraft engines, industrial systems and plastics. 90 % overlap with GE as compared to 70% overlap with UTC Perfect fit into the gaps in product line Aerospace business of Honeywell was a major attraction. Coming up :Proposed Merger part 1 continuedPresented by : Gouri
  10. 10. Proposed merger - I Continued.. Financial synergies - Around 1.5 billion $ but by mid-2001, it was upgraded to 3 billion $. Benefits to GE: • balance between manufacturing and financial segments • access to industrial assets and technological expertise • Contribution of GECAS will reduce Coming up :Proposed Merger part 2 continuedPresented by : Gouri
  11. 11. Proposed merger- II EC plays a spoil sport in dream merger The European Union (EU) law. Merger passed by US Department of Justice. The European commission (EC) Report. Coming up :Proposed Merger part 1 continuedPresented by : Rajeev
  12. 12. Proposed merger-II EC’s justification for barring the merger Horizontal overlap Vertical integration Conglomerate effects Coming up :Proposed Merger part 2Presented by : Rajeev
  13. 13. Demands and Counteroffers EC demanded the two Demanded GE companies to to divest parts divest some of GE proposed to of GECAS their aerospace divest itself operations.Merger failed from homesince GE did parts of avionicnot accept EU’s systems butsuggestions. rejected to spinoff GECAS.Presented By : Gouri Coming up :Repercussions Of The Failed Merger
  14. 14. Repercussions Of The Failed Merger • Economic situation in U.S. • Political motives behind the rejection • Invitation to retaliation • Degrading performance of Honeywell post failure of merger Coming up : Conclusion Presented By : Manish
  15. 15. CONCLUSIONPresented By : Akash
  16. 16. THANK YOU! Your Logo

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  • KubilayMustafa

    Nov. 28, 2015

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