We all have seen representation of power in movies being quoted as big fishes eating small fishes. This is not a proverb but a law of nature. We can see example of this law scattered all around us. Even economy news of all the countries in the world is not an exception to this law. Company news with the details of mergers and acquisition (M&A) states verity of this law.
Earlier this was something that was expected only by companies outside India. Story has now different shades now. Indian companies did some of the greatest acquisitions. Economy and Finance news channels have covered these events in great details giving us a moment to proud of being Indians in a way. Our baby steps are making bigger footprints on the map of the world.
Small Fish: Not Always Easy on Stomach of Big Fish
M&A are based on strategic planning of acquiring company. The stakes they chose to take in the other company depend on financial news and condition of that small company. This decision is also a part of inorganic growth of acquiring company. Mostly this is done in order to diversify the existing business or enhance the support functions of existing business. In all the cases this doesn't come with easy investments. Acquiring Company sometimes has to take loan to accomplish the deal. Company's existing Balance sheet can get impacted if the decision is proves to be wrong in any way. Economic News has done analysis on such cases how they may affect economy as a whole.
There are many business deals in past that went wrong making company news grim. Now companies have become more alert than before. They properly do the required homework for such deals. Acquirer Company also carry on due diligence of the company to be acquired so that its financial and legal troubles may not become albatross around the neck.
M&A: Necessity or Trend
These days we can see more and more M&A deals taking place. Is every company finding a suitable hand to add to its kitty or its just becoming a trend? Well if the level of work involved is really done then it can be said that opportunities are really showing their dazzle at times like slowdown or recession. Only the fittest survives in struggle of existence. Situations like M&A are well observed in these times. They occupy their spaces in different forms in Company news, Economy News and Financial News. Let's just hope they intend to do well on national and international level, economy and business altogether.
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