Tuesday, October 24, 2006

Pros and Cons of Cross-Border M & A's

If you don't have a presence in the acquired company's nation you get a ready market. You can take advantage of the good business conditions and infrastructure readily available in another country by investing in that market. You could take the advantage of flexible labour laws or high economic growth trajectory. You could be gaining advantage of customers who are more tech-savvy and form a more compelling audience. You can take advantage of libral tax regime. You can gain by a better work culture. On the flip side there may be a cultural misfit with the acquired company. There may be legacy jealousy lik ebetween UK and its erstwhile commonwealth countries. So don't just jump into the bandwagon of M & A'a. Hire a consultant to make a proper acessment of the complimentarity and fits and misfits between theh merging entities. Remember a whopping 70 % of mergers fail.

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