Essays on Merger & Acquisition Analysis: Apple & IBM Case Study

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The paper 'Merger & Acquisition Analysis: Apple & IBM" is a good example of a finance and accounting case study. The purpose of this paper is to establish whether a merger and acquisition should be conducted between an acquiring company: Apple Incorporated and a target company: IBM. The merger is set to combine the two firms so that Apple can go ahead and sustain the entire identity. In doing this, the paper conducts a step by step analysis of the two firms before providing a suggestion. Acquiring Company Profile Information: Apple Incorporated Apple Inc is a US-based technology company that designs, produces and markets such products as mobile communication and distinctive media services, personal computers and recently launched smartwatches (Yahoo Finance, 2014).

It also engages in the production and distribution of digital content music players across the international platform. Through its online and physical store presence, Apple sells such products as iPod, iPads and Apple Smart-watches. Other notable ways for which Apple conducts selling include; direct sales force as well as third-party cellular network carriers (Yahoo Finance, 2014). Industry Analysis Both Apple and Samsung operate under the global electric equipment industry.

The industry is made of firms that produce a significant number of digital products and services for the already existing IT-savvy customers positioned across the different world markets. The industry is highly competitive with customers purchasing behaviours highly attributed to the aspect of brand loyalty. The growth within the industry is associated with the recent expansion projects for their respective manufacturing processes into different economies such as the larger Asia-Pacific region in countries like Taiwan and China (MacWilliams, 2012). Given the intensive R& D activities in the North US section, the industry is set to grow exponentially hence contributing a lot to the overall GDP position.

It is set to create even more jobs in the future as the demand for technological-based equipment continues to increase across the globe. The North American industry is further characterized by the aspect of job outsourcing especially to China where labor costs are quite effective and affordable for that matter (MacWilliams, 2012). Merger Valuation Reviews Bouwman, Fuller & Nain, (2003) argue that the activities of mergers and acquisition have continued to attract more attention especially because of the significant volumes involved; the United States of America M& A activities have continued to increase to 16% of the overall GDP by the end of 1999 while the value of global mergers and acquisition attaining a peak of more than $3.5 trillion in 2000 (Bouwman, Fuller & Nain, 2003).  

References

Bouwman, C. H., Fuller, K., & Nain, A. S. (2003). Stock Market Valuation and Mergers. MIT Sloan Management Review, 45(1), 9-11.

Berger, D. (2015). Appraisal litigation raises merger costs. International Financial Law Review, 1.

Ketz, J. E. (2000). Do Mergers and Acquisitions Add Any Real Value? Journal of Corporate Accounting & Finance (Wiley), 11(2), 31-33.

Murray, J., & Burch, K. (2014). Recent Trends in Academic Medical Center Mergers, Acquisitions and Affiliations. Health Lawyer, 26(3), 29-34.

MacWilliams, J. (2012). US electronic industry faces major challenges. Retrieved from http://www.electroline.com.au/content/business/article/us-electronics-industry-faces-major-challenges-1377348905

Sorescu, A. B., Chandy, R. K., & Prabhu, J. C. (2007). Why Some Acquisitions Do Better Than Others: Product Capital as a Driver of Long-Term Stock Returns. Journal of Marketing Research (JMR), 44(1), 57-72

Yahoo Finance! (2014). Apple Company profile. Retrieved from http://finance.yahoo.com/q/pr?s=AAPL+Profile

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