SMU MBA SEM 3 – FIN302 – MERGERS AND ACQUISITIONS
DRIVE
fall 2017
PROGRAM
MASTER OF BUSINESS ADMINISTRATION (MBA)
SEMESTER
III
SUBJECT CODE & NAME
FIN302 – MERGERS AND ACQUISITIONS
- 1. Explain the basis for arriving at Fair Price.
- Explanation for the basis for arriving at Fair Price. 10
Answer:-
Basis for arriving at fair price
All-India level financial institutions and banks follow the following criteria for calculating the fair
Q 2. Explain the concept of Synergy and the prerequisites for its creation.
- a) Explanation of the concept of Synergy 4
- b) Explanation of the prerequisites for its creation 6
Answer:-
- a) Explanation of the concept of Synergy
Synergy refers to a situation where the combined value of a merger is more than the sum of the values of merging firms. It is the phenomenon where 2 + 2 = 5. If the value of firm A is VA value of firm
Q3. Explain Demerger and its tax implication.
- a) Explanation of Demerger 4
- b) Explanation of the Tax Implication of Demerger 6
Answer:-
- a) Explanation of Demerger
Demerger is often used to divide or separate some undertakings of a business, functioning till then under a common umbrella. It is a way to get rid of underperforming or non-core business divisions that can
SET-II
- 1. A strategic alliance is when two or more businesses joins for a set period. Explain its advantages. Explain the tax aspect of Joint Venture.
1) Advantages of Strategic Alliance 5
2) Tax aspect of Joint Venture. 5
Answer:-
1) Advantages of Strategic Alliance
- Gain a
Q.2: Explain the types of takeovers. Explain defenses against takeover bids.
- a) Types of takeovers.
- b) Defenses against takeover bids.
ANS:
- a) Types of takeovers:
Takeovers are of different types.
Bailout takeovers Bailout takeover refers to a substantial acquisition of shares in a financially weak
Q.3: Explain the factors in Post-merger integration and Five rules of Integration Process.
- a) Explanation of factors in Post-merger integration.
- b) Explanation of Five rules of Integration Process.
ANS:
- a) Explanation of factors in Post-merger integration:
Some important factors that can decide the success or failure of a merger or acquisition are: Due diligence: Thorough due diligence involves comprehensive analysis of the financial position, management capabilities, physical assets and intangible assets of the target company. However, it can result in failure
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