12/1 Class Flashcards
1
Q
slides
A
recommendations
key strategic issues
6-7 minutes
2
Q
final exam
A
on slides,
3
Q
financial economies of scope
A
tax advantages
diversification
4
Q
economies of scope
A
private economies
costly to imitate economies of scope
5
Q
tips to avoid overpaying
A
bidding firms perspective: seek thinly traded markets close the deal quickly avoid bidding wars limit the info to the target limit info to other bidders search for rare economies
6
Q
implementation issues
A
m-form structure is typically used
management controls & compensation policies are similar to those used in diversification strategies
7
Q
critical organizational issues
A
melding two disparate corporate cultures
linking different financial and control systems
building effective working relationships
loss of key personnel weakens the acquired firm’s capabilities and reduces its value
8
Q
problems with acquisitions
A
inadequate evaluation of target
inability to create synergy
inability to create integrate
