Contemporary Finance – Sandeep Goel

The company acquiring shares is termed the holding company, while the company in which the shares are acquired is termed the subsidiary company. In an acquisition, two or more companies may remain independent, separate legal entities, but there may be a change in control of the companies. Types of mergers Mergers are of the following types. I. Horizontal merger This is a combination or joining of two or more firms in the same area of business. In a horizontal merger, both the merging firm(s) and the merged firm(s) produce and sell identical or similar products in the same geographic area.

A merger of firms that are in direct competition with each other is called a horizontal merger. For example, the merger of Vodafone India with Idea Cellular to form Vodafone Idea Ltd. (Vi) and the acquisition of Daksh by IBM are examples of horizontal mergers. The advantages of a horizontal merger are as follows: Elimination or reduction in competition End to price wars Economies of scale in operations.

II. Vertical merger This is a combination of two or more firms involved in different stages of the production or distribution. A combination of two or more firms that fall in the same industry but operate at different stages of the production– distribution chain is termed as a vertical merger. One example of such merger is between Time Warner Inc., a major cable operation, and the Turner Corporation, which produces CNN, TBS and other programming.

Vertical merger may take the form of ‘forward’ or ‘backward integration’. When a company combines with the supplier of material, it is called backward integration (merger), for example, a tyre manufacturer integrates with a rubber manufacturing firm. It is an upstream merger. When a firm combines with the buyer or customer, it is known as a forward integration (merger), for example, a tyre manufacturing firm combines with a two-wheeler manufacturing firm.

It is a downstream merger. The advantages of a vertical merger are as follows: Reduction in the cost of production Optimisation of resources Better service resulting from supply chain integration. III. Conglomerate merger This is a combination of two or more firms that are engaged in unrelated lines of business activity. It is a type of combination in which firm(s) established in one industry combine with other firm(s) in an unrelated industry.

It generally involves diversification of business activities and, therefore, is considered to pose no threat to competition. For example, the merging of different businesses, like the merger of a company manufacturing cement products and electronics products. The merger between the Walt Disney Company and the American Broadcasting Company is an example of conglomerate merger. The advantages of such a merger are as follows: Market expansion or product extension Mitigation of risk.

A brief explanation of each form of combination is given in Figure 6.1. Motives of mergers and acquisitions The key goal of mergers and acquisitions is considered to be ‘the maximisation of shareholders’ wealth’.

“A bold and thought-provoking exploration of the future of finance, a cutting- edge guide to understand the complexities of the rapidly evolving fintech landscape!! The author’s passion for harnessing technology to drive financial inclusion is very inspiring and evident in this book.” – Ms. Shubha Naresh Bhambhani, Additional Director General, Department of Telecommunications Ministry of Communication & IT, GoI, New Delhi “With easy examples and real-world insights, it helps readers understand the basics and apply them in everyday business decisions.

A perfect guide for those who don’t come from a finance background but want to make smarter choices at work.” – Dr. Narain, Professor of Finance, Faculty of Management Studies, University of Delhi 1kitap1.com/en Contemporary Finance This book presents an up-to-date account of contemporary themes and topics in finance. It explores the world of finance from a fast-changing and developing finance perspective.

Lucid, accessible, yet comprehensive, the volume discusses: Financial system with its constituents and instruments; Recent trends and approaches in value-added and strategic management; Current laws and legislations in the domain of taxation – direct and indirect; Emerging concepts and practices of digital finance, known as ‘fintech’. Presenting current global trends and real-world cases in finance and richly illustrated with tables, figures and learning tools, this volume will be indispensable for individuals, business managers and management students pursuing courses related to contemporary finance and financial management.

It will also be an important resource for executive and management development programmes (EDPs & MDPs) as well as professionals, corporates, entrepreneurs, government officials, academicians and researchers. Sandeep Goel is a Senior Professor of accounting and finance, and corporate governance at Management Development Institute (MDI) Gurgaon, India. He holds two doctorates, one in finance; and another in accounting, from the Faculty of Management Studies, University of Delhi. He completed his bachelor’s degree with honors and master’s degree in commerce with specialisation in finance from Shri Ram College of Commerce and the Department of Commerce, Delhi School of Economics, University of Delhi, respectively.

He has three decades of industry and academic experience across various organisations and institutions of repute, including the Shri Ram Group, the University of Delhi and MDI Gurgaon. He sits as an Independent Director on the Board of Machino Plastics Ltd., Gurugram, a Suzuki JV. He is a visiting professor at the Faculty of Management, University of Lodz, Poland, and Aix-Marseille Graduate School of Management – IAE Aix-Marseille University, France.

He is a management trainer and consultant to organisations like Maruti Suzuki, Canara Bank, JK Tyre, PFRDA, NPCI, IRS, ITS, FIA Business School (Brazil), Bata, Encore, Federal-Mogul Goetze (India) Ltd., SOS Village International, Cairns India, National Banking Institute (Nepal), Druk Holdings (Bhutan), UltraTech Cements, ONGC and many more.

This is a short excerpt from the opening of “” by Unknown, quoted for review and introduction purposes. All rights belong to the copyright holders.

Book Information

• Unique ID: 96739b6fa2abd03b
• File Extension: .pdf
• File Size: 5,046,202 bytes (4.812 MB)
• Title: –
• Author: Unknown
• ISBN: 9781041212263, 9781041220114, 9781003730170
• Pages: 204
• Language: English (en)

Reading & Word Statistics

• Estimated Reading Time: 195.97 minutes
• Total Words: 39,193
• Total Characters: 250,806
• Average Words per Page: 192.12
• Average Characters per Page: 1229.44

Most Frequent Words

tax (435), market (279), value (250), company (206), income (199), india (171), corporate (159), financial (158), companies (148), capital (129), funds (118), gst (115), exchange (114), year (113), rate (112), governance (103), act (100), goods (99), services (99), cost (94), foreign (94), finance (92), fintech (92), human (92), business (90), securities (85), mutual (82), shares (81), management (77), government (77), total (74), bank (72), assets (69), indian (67), one (66), central (66), fund (65), equity (64), method (63), new (62), money (62), section (62), price (61), markets (57), stock (57), taxes (55), merger (54), state (53), banks (53), investment (51), two (50), firm (50), board (49), growth (49), shareholders (49), example (49), asset (48), net (48), usage (48), bonds (47), committee (47), resources (46), ltd (46), currency (46), valuation (45), number (45), million (45), resource (43), process (43), years (43), person (43), eva (42), public (42), insurance (42), also (41), com (40), indirect (40), based (40), types (39), rbi (39), issued (39), period (39), future (38), accounting (38), liability (38), preference (38), organisation (38), following (38), investors (38), debt (38), increase (38), direct (37), like (37), rates (37), sector (37), paid (37), basis (37), instruments (36), debentures (36), interest (36).

PDF Download