Discovering the examples of acquisitions that did well

Discovering the examples of acquisitions that did well

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Listed below are some company strategies relating to acquisitions

Many individuals presume that the acquisition process steps are constantly the same, whatever the business is. However, this is a standard misconception since there are actually over 3 types of acquisitions in business, all of which come with their very own procedures and approaches. As business people like Arvid Trolle would likely validate, one of the most frequently-seen acquisition techniques is known as a vertical acquisition. Basically, this acquisition is the polar opposite of a horizontal acquisition; it is where one company acquires another business that is in a completely different place on the supply chain. For example, the acquirer business may be higher on the supply chain but opt to acquire a business that is involved in a key part of their business functions. In general, the appeal of vertical acquisitions is that they can bring in new earnings streams for the businesses, as well as lower prices of production and streamline operations.

Among the numerous types of acquisition strategies, there are 2 that people have a tendency to confuse with each other, probably due to the similar-sounding names. These are called 'conglomerate' and 'congeneric' acquisitions, which are two really separate strategies. To put it simply, a conglomerate acquisition is when the acquirer and the target firm are in completely unconnected markets or engaged in separate endeavors. There have been lots of successful acquisition examples in business that have involved 2 starkly different companies without any overlapping operations. Typically, the purpose of this strategy is diversification. As an example, in a situation where one product and services is struggling in the current market, firms that also possess a diverse range of additional products and services have a tendency to be more steady. On the other hand, a congeneric acquisition is when the acquiring firm and the acquired company are part of a comparable sector and sell to the same type of client but have relatively different services or products. Among the major reasons why companies may opt to do this kind of acquisition is to simply broaden its line of product, as business individuals like Marc Rowan would likely validate.

Prior to diving into the ins and outs of acquisition strategies, the initial thing to do is have a solid understanding on what an acquisition actually is. Not to be confused with a merger, an acquisition is when one business purchases either the majority, or all of another firm's shares to gain control of that firm. Generally-speaking, there are around 3 types of acquisitions that are most popular in the business world, as business people like Robert F. Smith would likely recognize. Among the most prevalent types of acquisition strategies in business is known as a horizontal acquisition. So, what does this imply? Basically, a horizontal acquisition entails one company acquiring another firm that is in the same market and is performing at a comparable level. The two companies are primarily part of the same industry and are on an equal playing field, whether that's in manufacturing, financing and business, or farming etc. Usually, they might even be considered 'competitors' with one another. In general, the primary benefit of a horizontal acquisition is the increased capacity of raising a firm's consumer base and market share, along with opening-up the opportunity to help a company grow its reach into new markets.