A Critical Analysis Of Merger And Acquisition In India
K.B Surya Anumanthprabu
ABSTRACT
The concept of merger and acquisition is very much popular in the current scenario, so it is significantly popular concept after 1990s where India entered in the liberalization, privatization and globalization (LPG) era. The winds of LPG are blowing over all the sectors of the Indian economy but it’s become hyper-competitive and to face international and multinational companies, India companies are going for merger and acquisition. Basically a merger involves a marriage of two or more entities. Merger is defined as blending entity will become the substantially the shareholder in the entity which is to carry on the blended entity. Merger and acquisition have been a very important marker entry strategy as well as expansion strategy. The present era is known as competition era. In this era companies, to avoid the competition, go for merger, and enjoy sometimes monopoly. Corporate India is waking up to the new millennium imperative of mergers and acquisition in a desperate search for a panacea for facing the global competition. This hardly surprising as stiff competition is, in a sense implicit in any to integrate the national economy with the global economy. The ongoing process of liberalization has exposed the unproductive use of capital by the Indian corporate both in public and private sectors. Consolidation through mergers and acquisition is considered one of the best ways of restricting structure of corporate units. In the case of internal expansion or by external expansion. In the case of internal expansion, a firm gradually over tie in the normal course of the business, through acquisition of new assets, replacement of the technologically overnight through corporate combinations. These combinations are in the form of mergers, acquisitions, amalgamations, and takeovers and have been now become important features of corporate restructuring. They have been playing an important role in the external growth of a number of leading companies the world over. They have become popular because of the enhanced competition breaking of trade barriers, free flow of capital across countries have also started restructuring their operations around their core business activities through merger, acquisition and takeovers because of their increasing exposure to competition both domestically and internationally.
