The paper "Business Organisation Policy " is a great example of a Business Case Study. Mergers and acquisitions have increasingly been embraced by different companies owing to the rapid and intensive increase in competition. When well approached, merging and acquisitions impact a series of desirable benefits to the involved companies including economies of scale, opportunities for research and development, duplication avoidance, and reduced tax liability. Nevertheless, if not well approached, mergers and acquisitions may have adverse effects on the involved companies including diseconomies of scale, job losses, high prices, reduced consumer choice, and worker demotivation.
There are various laws in the UK that govern merger and acquisition (M & As) arrangement including the city code, the listings rules, and prospectus legislation, due diligence, competition law. Corporate social responsibility (CSR) is an important aspect to consider in merging and acquisition arrangements. For Shell PLC to succeed in establishing a proper relationship with the community, there are various approaches that ought to be adopted in its CSR operations. These approaches include engagement of the stakeholders, partnership initiatives, and upholding extra-legal standards.
Generally, for companies that wish to enter into mergers and acquisitions, there are various recommendations that should be considered. These include proper implementation of the strategy used in the acquisition, avoiding disruptions to ordinary business and considering M& As as teamwork. Introduction The phenomena of economic forces centralization and economic units’ transformation from small to large units have increasingly distinguished the economy in contemporary society. Expanded business projects have increasingly become effective in this era in achieving economic advancement and progress. To enable economic centralization, organizations have continuously acknowledged mergers and acquisitions (M& A) as the way forward.
For this reason, companies in the UK have increasingly embraced M& A to record levels over the last two decades. Such growth could be attributed to the decrease in the cost of funding, an increase in globalization, and avoidance of bankruptcy among companies. M& A has various advantages and disadvantages, which ought to be well considered before embracing them as strategic approaches. The UK laws affecting M& A provide for various regulations that ought to be observed both by the buyer and the target company to effectively pursue them. Benefits and Drawbacks of Mergers and Acquisitions Both the long-term and the short-term strategic outlook of a company are critical determinants of the success or disadvantages related to M& A.
This is as a result of various factors that include business culture differences, market conditions, and alterations to the financial strength that surrounds organizational takeover (Hill & Jones 2009, p. 292). In cases where an organization is not able to recognize any short-term financial advantages, the long-term benefits may be viewed as important determinants of a merger or acquisition. This section discusses the various pros and cons of mergers and acquisitions both to the involved organizations and other affected stakeholders. Network economies are an advantage when entering into M& As to the involved companies (Coffey et al.
2012, p. 102). Some industries require firms to offer a national network or just a broad network. This implies that the processes involve various economies of scale which are advantageous to the merging or acquiring companies. As such, M& A increase the coverage of companies within a given industry and reduce the number of players, thus promoting efficiency and minimizing competition.
An example of this advantage is depicted in the merger between Orange and T-Mobile in the UK. By merging the two networks, the companies were able to establish a single powerful network and to mitigate duplication. This also increased their customer base as the customers viewed the established network as bigger with better coverage (Coffey et al. 2012, p. 112). Similarly, the merging led to the reduction of stations an aspect that reduced the cost for the companies. With the growing competitive nature of the marketplace and the increasing rate of globalization, it is vital for organizations to promote research and development to enable the discovery of new technologies and products.
Mergers increase the profitability of the firm and thus increase the availability of funds that can be invested in research and development.
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