International Mergers Acquisitions and Joint Ventures

Microsoft & Skype

An acquisition or merger is known as the combination of the two companies. In this way, one company is absorbed into the other company completely. In the process of the acquisition the identity of one company loses and it becomes the part of other company. The less important company is merged into the important company or organization, which keeps its identity (Marks, 2002). International Mergers Acquisitions are different from the consolidation because in the process of consolidation both of the companies loses their identities and then there emerges a new company with a new and unique identity. In the process of International Mergers Acquisitions, the laws that are state or federal regulates the process. In the past few years, it has been observed that cross-border mergers are increasing and becoming more popular. It has also been observed that there are a few success examples while most of the process leads to failures.

In the cross-border merger, acquisition or joint venture the merger ends the competition with the company in which it is merging. This has been increased and now in the U.S there is a law that enables to purchase the companies or even some specific departments or parts of the companies or organizations (Marks, 2002). There are many social benefits if this process. In the modern time, the merger can have the better management options because of the company in which it is merging that can prove to be an asset to the company. In the cross-border merger, acquisition or joint venture there are many benefits. For example, one can have better production opportunities, improve and more advanced quality at less cost and moreover the increased output. This leads to a better business and in this way if the companies have a solid strategic planning then they can have better results in their business. This is also beneficial because a merge can get the most advanced skills and techniques from the company in which it is merging. This can also lead the business owner or the company which has purchased the new firm to work more professionally and to take that company to the position in which it can benefit both the companies. The cross-border merger, acquisition or joint venture also leads to the fewer risks in the competition, which enables to work on the specific tasks that can lead to the improvement in the business and profits (Marks, 2002).

The merger of Skype and Microsoft, in 2011, was a big breakthrough in the merger acquisitions and joint ventures. Both companies had a huge volume of users as well as a great business output. This acquisition increased not only the convenience of real-time audio-video communications, but also brought benefits to enterprise users, consumers and company itself. It generated vital new businesses and revenue opportunities for the company (Singh, Maan and Khanapuri, 2012).

Different governments have worked on the laws and the regulations to empower this process of cross-border mergers, acquisitions and joint ventures for the better economy. When we analyze the economy of U.S then it is obvious that this process has proved to be effective for the economy of the U.S and this is more beneficial when considered in the telecommunication industry in the recent years. There are different reasons for this success along with the proper strategy. Another major example that can be seen in the context of the cross-border mergers, acquisitions and joint ventures is the merging of the CBS, ABC and NBC into one corporation (Ginsburg and Levin, 1992). These were the major contributors in the news and were working independently at that time. This merging process had a deep impact on the industry at that time. After the merging process, they have not only worked in a new way but proved to be more successful in the business and as an industry also. They have become the dominant power in the news industry. Similar is the case with the Microsoft.

Although there are some views that the cross-border mergers, acquisitions and joint ventures are not so effective because in this process the part of competition loses and also the prices are controlled by one large organization which before were fluctuating due to the competition among the companies. But there are also some factors that need to consider when analyzing the cross-border mergers, acquisitions and joint ventures (Ginsburg and Levin, 1992). The market and the market share is the main factor that forces the cross-border mergers, acquisitions and joint ventures. This is why it is being happening in almost all of the industries and companies. This has a relation with the future because it has helped the economies to strengthen and move towards growth.