Proposal Article Example | Topics and Well Written Essays - 750 words

Proposal - Article Example Infringing products have consequently been targeted for a ban in the United States, including Samsung's front line, iconic Galaxy series phones. The message seems to be this, that Apple will protect its American turf from Samsung, which it views as largely copying Apple's designs and technologies for the iPhone. The peripheral goal, too, is to make sure that Samsung is put on notice as Apple brings the fight to other markets and legal jurisdictions the world over. There are big underlying logistics and design considerations that are tied to these battles, apart from the patents, but the patent front is the busiest by far, and most visible. This is owing to the fact that in the smart phone market, whoever holds the patents for key technologies and innovations have the ability to dictate the terms of their use. Meanwhile, what complicates the picture is that both rely on economies of scale and efficiency in parts production and sourcing. Moreover, tied to this, Samsung is also a suppli er of essential components of smart phones to Apple. This being the case, it is difficult for the two players to untangle themselves from the patent mess that they find themselves in. For Samsung it is a delicate balancing act, because as much as they need to compete in smart phones, they also rely on Apple to shore up their own components business, and losing Apple would amount to losing a valuable components customer. For Apple, the tussles with Samsung on the smart phones front highlights their need to find alternative suppliers for essential components (Lohr, 2012; Lloyd et al., 2011; Cromar, 2010; Gerardin and Layne-Farrar, 2011; Seppala and Kenney, 2012; Layne-Farrar, 2012; Boldrin and Levine, 2012; Siren, 2011; Gotts and Sher, 2012; Hagiu and Yoffie, 2011; Allison et al., 2012). Problem Formulation The literature review has highlighted the need for innovation around key aspects of technology, components, design, and software for both Samsung and Apple moving forward. Also, as far as Samsung is concerned, Apple's litigation win underscores the need to shore up Samsung's intellectual property portfolio in order to protect its smart phones business and to make sure that Samsung continues to dominate the market in the future. One key problem is that while Samsung has an enviable position as a key manufacturer of essential smart phones components, and benefits from scale economies by being so, its reliance on Android and its seeming problems with defending itself from intellectual property lawsuits from Apple and other firms makes it vulnerable. The problem is how is Samsung to position itself and to spend its money and resources so that it is able to get itself into a better position relative to the intellectual property battles it is engaged in with Apple and other firms (Lohr, 2012; Lloyd et al., 2011; Cromar, 2010; Gerardin and Layne-Farrar, 2011; Seppala and Kenney, 2012; Layne-Farrar, 2012; Boldrin and Levine, 2012; Siren, 2011; Gotts and Sher, 2012; H agiu and Yoffie, 2011; Allison et al., 2012). . Proposal This is a proposal that takes off from the problem formulation above, and tries to come up with a viable strategy for Samsung relative to its competitors in the global smart phones market. That strategy has to address the gap in Samsung's arsenal of patents related to innovations in basic technologies, components, and design, among other things. The proposal is to explore different strategic options

Cuban Missile Crisis of 1962 Essay Example | Topics and Well Written Essays - 3000 words

Cuban Missile Crisis of 1962 - Essay Example The event is of tremendous strategic importance for it had great impact on shaping international relation, foreign and economic policies and also affected both countries on a sociological front. The essay will analyze the significance and the magnitude of its impact that on global politics. Cuban Missile Crisis I. Background Cuban Missile Crisis was just another outcome of the Cold War that existed between the two superpowers of that time, Unites States and Soviet Union. However, the crises were mainly after the liberation of Cuba by Fidel Castro. 1The United States were already ambivalent about their involvement in Cuban politics and were particularly happy about the coup held by Castro but soon enough, the Cuban leader fell out of favor with the Americans for his alliance with the Soviet Union and the Americans began to fear the formation of one more communist nation. Cuba’s associations with the communist bloc were feared by then president Richard Nixon in confidential memo randums issued for the CIA. Cuba was declared a socialist nation by Fidel Castro on 1st May, 1961 and its affiliation with the communist bloc was further consolidated. ... Therefore, the tension between Cuba and America intensified ever since and the situation became even worse when the American intelligence began intercepting messages and satellite pictures showed establishments of arm bases around the island nation. In 1962, the United States established military bases in Turkey armed with Nuclear Missiles that were clearly meant to keep Soviet activity at bay. 3This move was defended by the United States as precaution against the military bases in Cuba that were quickly becoming a rising threat for the Americans. One of the biggest turning points preceding the main crises were the alleged training of 1300 Cuban exiles by the CIA in order to stage a coup against the Castro regime. However, this particular move by Americans led to a conflict in the Bay of Pigs that ended up in a major fiasco for the American side and subsequently shamed the entire American intelligence and the president in front of the whole world. Therefore, in 14th October 1962 the Soviets granted full arms support to Cuba against any further threats by the United States and so there were satellite images found by American intelligence that showed missile sites around Cuba that had missiles pointing towards every single major town in the United States. President Kennedy was forced to issue a public announcement acknowledging and admitting to the immediate threat that the entire country was now under and therefore, these small conflicts had now eventually been turned into one major crises situation that brought the world to the brink of nuclear annihilation. II. Game Theory and Cuban Missile Crisis Considering the initial premise of the crisis, the entire event has been described by scholars as both sides had completely turned a blind side to

E-Project Management Essay Example for Free

E-Project Management Essay Information is king to any business. Optimum utilization of information for efficient and timely retrieval is crucial to every business and people for their well being and proper nurturing. Every business functions with knowledge and effective use of it reflects in solving issues and conflicts. Every enterprise places great importance for its customers who drive their organization. Providing online facilities to them would prove access anywhere anytime. Businesses learned with time the project management techniques for effective delivery and service. Library of templates, checklists and pre-approved processes take a project from idea generation stage to completion. The customized dynamic applications which are pre-configured helps in the process of adding a shining touch to the finished product. Online repositories and expert systems have facilitated this process. Unique software for risk management, communication planning, stakeholder analysis, scope management, stock analysis and tracking of project schedule are the essentials which help in the entire process. It also proposes efficient MIS reports and decision support systems to take care of the communication strategies and tracking of reports. It is capable to present a picturesque view of the entire project management activities through several intermediaries such as Gantt charts and other illustrations. The efficient tracking mechanism in eProject management would result in greater flexibility of operations and larger penetrations to detect risks and associated problems. It also facilitates the risk handling process by identifying and capitalizing on them timely to prevent efficient managing of resources. The greatest incentive is the importance given to knowledge and its appropriate use. The use of knowledge repositories and capabilities of internet has facilitated the process of concept through revenue generation taking into account the dynamic movements in schedule, cost and resources.

Ecommerce :: Essays Papers

Ecommerce The Internet has caught on like wild fire. No one ever intended for it to be so commercially successful. In the beginning, its main purpose was to send and receive messages; no one anticipated that one-day people could buy books and cars over a computer. Though with the advancement of certain technologies, this has happened. E-commerce is a worldwide commodity that has taken the place of trips to the supermarket and has given us the freedom to conduct business at out house in our pajamas. To fully understand what e-commerce is, you must first understand where it came from. It all started with the DOD (Department of Defense) in 1996. After the Cold War the Government wanted a reliable line of communication. If a network link became damaged by enemy attack, the information on it could be rerouted automatically to other links. This was the birth of the Internet. In order to use anything on the Internet, it is required that you learn to operate a separate program, one for the mail, one for news groups, and several different programs for accessing databases. This all changed in 1989. A researcher at CERN (a big European physics laboratory) named Tim Berners-Lee started to work on hypertext. By using hypertext he could link together all the different kinds of information available on the Internet. Berners-Lee called the software pack the World Wide Web. For the World Wide Web to work, each page has it’s own address that the web recognizes using a system called HTTP (Hypertext Transport Protocol). Each page has to be written with a special language called HTML (Hypertext Markup Language). This language tells the computer how to display a page. Now with the invention of the web, Businesses can use pictures to help sell their merchandise online, And now that the Internet is everywhere- in schools, libraries, and even cafes – anyone can order just about anything from anywhere. It is now easier than ever to have and start your own web page; anyone form a big corporation or even the average joe can build his for her own web page. Just like Jeff Bezos, Time magazine’s Person of the Year of 1999. With a loan from the bank, Jeff founded Amazon.com in his garage and helped start e-commerce, as we now know it.

Complete Finance & Accounts Outsourcing Solutions Essay

To professionally manage the collection, flow and direction of critical financial information so that management is able to take informed decisions. Timely and accurate information also empowers the Company to be proactive rather than reactive to trends or situations. Company Profile A leading retail food company, pan India presence, 500 employees, turnover INR 180 million. Challenge In the retail food industry, one of the keys to survival and growth is having timely information on food costs and other line items. Our client’s accounts department was not able to put together this critical information in the desired format even after circulating a standard format among outlets. Further, there were many clerical errors and a lack of understanding about the real purpose of the information sent by the company’s outlets. To make matter worse, the information received from outlets was irregular, making it difficult to deliver the MIS on a target date to the company’s management. Solution Not only did the MIS function take up too much of the CFO’s time and energy, in addition, it consumed the efforts of a dedicated professional, a qualified Chartered Accountant. Management recognized that better information was needed to understand where the strategies in terms of Food Costing were not working. BC was approached and contracted to streamline this function. Before this, BC had not worked with any client in the retail food industry. Implementation First, we conducted a professional due diligence process which took 5 working days to diagnose the real problems. Then, we prepared a short term view on issues to be addressed over the following 3 months. Also, we prepared a long term plan in which larger issues would be addressed over a period of 12 months. In the first stage, the real problem of co-ordination between the outlet personnel and accounts personnel was addressed by simplifying the format. BC undertook to educate them in why the information was required, and how it would improve the overall business. Within 2.5 months, the entire MIS was in place and the system was on the track. Current Status The biggest value addition by BC in the MIS area was its ability to help management to control Food Cost by 5 %. Another direct benefit of the whole process was the establishment of trust and respect between the outlets and the F&A department. We are now in the next phase of designing a system to track some specific cost items on daily basis.

Comparison And Contrast Of William Blakes Poems Essay

Comparison and Contrast of William Blakes Poems Introduction (Innocence) Piping down the valleys wild, Piping songs of pleasant glee, On a cloud I saw a child, And he laughing said to me: quot;Pipe a song about a lamb!quot; So I piped with merry chear. quot;Piper, pipe that song again;quot; So I piped, he wept to hear. quot;Drop thy pipe, thy happy pipe; Sing thy songs of happy chear:quot; So I sung the same again, While he wept with joy to hear. quot;Piper, sit thee down and write In a book, that all may read.quot; So he vanishd from my sight, And I pluckd a hollow reed, And I made a rural pen, And I staind the water clear, And I wrote my happy songs Every child may joy to hear. Introduction (Experience) Hear the†¦show more content†¦The Chimney Sweeper (Experience) A little black thing among the snow, Crying weep! weep! in notes of woe! quot;Where are thy father amp; mother? say?quot; quot;They are both gone up to the church to pray. quot;Because I was happy upon the heath, quot;And smild among the winters snow, quot;They clothed me in clothes of death, quot;And taught me to sing the notes of woe. quot;And because I am happy amp; dance amp; sing, quot;They think they have done me no injury, quot;And are gone to praise God amp; his Priest amp; King, quot;Who make up a heaven of our misery.quot; Infant Joy (Innocence) quot;I have no name: I am but two days old.quot; What shall I call thee? quot;I happy am, Joy is my name.quot; Sweet joy befall thee! Pretty joy! Sweet joy, but two days old. Sweet joy I call thee: Thou dost smile, I sing the while, Sweet joy befall thee! Infant Sorrow (Experience) My mother groand! My father wept. Into the dangerous world I leapt: Helpless, naked, piping loud: Like a fiend hid in a cloud. Struggling in my fathers hands, Striving against my swadling bands, Bound and weary I thought best To sulk upon my mothers breast. The best-known work of the English poet and artist William Blake, Songs of Innocence and of Experience employs the mediums of poetry and colored engraving in a series of visionary poems quot;shewing the two contrary states of the human soul.quot; Songs of Innocence (1789) was followedShow MoreRelatedWilliam Blake in Contrast of Songs of Innocence and of Experience1452 Words   |  6 PagesEN 222-Intro to British Lit. II April 21, 2012 William Blake in contrast of Songs of Innocence and of Experience William Blake, an engraver, exemplified his passion for children through his many poems. Blake lived in London most of his life and many fellow literati viewed him as eccentric. He claimed to have interactions with angels and prophets, which had a great influence on his outlook of life. Blake believed all prominent entities, those being church, state, and government had become sick withRead MoreComparison of London by William Blake and Lines Composed upon Westminster Bridge by William Wordsworth1105 Words   |  5 PagesComparison of London by William Blake and Lines Composed upon Westminster Bridge by William Wordsworth Earth has nothing to show more fair, taken from William Wordsworths Lines composed upon Westminster Bridge, could not be more of a contrast to the way William Blake describes what he sees in his poem London. William Wordsworth and William Blake both wrote their poems within a very similar time, yet they are completely different in all aspects. Lines composed uponRead MoreEssay on The Symmetry: A World with Both Lamb and Tiger1063 Words   |  5 Pagesand terror? The Tyger by William Blake, written in 1794 and included in his collection Songs of Innocence and Experience, takes readers on a journey of faith. Through a cycle of unanswered questions, William Blake motivates the readers to question God. Blake sees a necessity for balance in the world, and suggests to the readers that God created a world with a balance of good and evil so that humanity can see goodness more clearly through contrast and comparison. This theme is achieved throughRead MoreThe Chimney Sweeper : A Little Black Thing Among The Snow1659 Words   |  7 Pagesmovement. Literature began to move in channels that were not entirely new but were in strong contrast to the standard literary practice of the eighteenth century. Poets became particular famous for their poems which would often criticize the society of the times, and often give a v oice to the marginalised and oppressed. As well as this Poets would also made arresting comparisons to children in there poems, they believed children where exceptional due to the poets beliefs that they were innocentRead MoreThe Garden Of Love By William Blake1420 Words   |  6 PagesIn William Blake’s poem, The Garden of Love, the speaker is trying to convey that life is in a constant state of inconsistency and that nothing can remain uniform. Blake uses religion in a negative light to convey that restriction on life, particularly love, corrupts life and prevents you from experiencing happiness. The main conflict presented in this poem is between the individual and religion. Blake uses religious symbols such as chapels, graves, and priests to show how religion can destroy theRead More An Analysis of Blakes The School Boy Essay1745 Words   |  7 PagesBlakes Songs of Innocence and Songs of Experience in its themes and imagery. Like many of the other poems in this work it deals with childhood and the subjugation of its spirit and uses imagery from the natural world. While first published in 1789 as one of the Songs of Innocence there are strong reasons why Blake moved it to the Experience1 section of the 1794 edition. If we compare it to other poems in the collection it sits better with others in Experience than those in Innocence. On first readingRead MoreThe Lamb and the Tyger Essay1437 Words   |  6 PagesThe Tyger and The Lamb by William Blake, written in 1794 included both of these poems in his collection Songs of Innocence and Song of Experience, takes readers on a journey of faith. Through a cycle of unanswered questions, William Blake motivates the readers to question God. These two poems are meant to be interpreted in a comparison and contrast. They share two different perspectives, those being innocence and experience. To Blake, innocence is not better than experience. Both states haveRead MoreLondon by William Blake and Upon Westminster Bridge by William Wordsworth1327 Words   |  6 Pagesby William Blake and Upon Westminster Bridge by William Wordsworth This essay aims to compare and contrast the differences and similarities between the two poems London and Upon Westminster Bridge. They both create powerful, contrasting images but are both similar in the use of language and exaggeration. The first poem to be commented upon is London by William Blake, written a couple of decades before the second poem written by William Wordsworth. William BlakeRead MoreWilliam Blake Songs of Innocence Experience1256 Words   |  6 Pagesâ€Å"The Chimney Sweeper† Songs of Innocence amp; Experience analysis with, William Blake In 1794 William Blake’s work was known and published as a collection of poems that were put together as one book called Songs of innocence amp; Songs of Experience. In the collection Blake titles a poem, â€Å"The Chimney Sweeper†, and this one is viewed in two ways: Innocence and experience. In the book of innocence Blake shows how poor innocent children are being abused and mistreated during this time era. In SongsRead More, Allusion, And Symbolism In The Tyger By William Blake771 Words   |  4 PagesIn the poem â€Å"The Tyger† by William Blake, the use of rhyme, repetition, allusion, and symbolism all help the reader understand the theme and what was going through the authors thoughts while writing. William Blake was a mystic poet who channeled his thoughts and questions to write poems. He questioned the creator of both the Tyger and lamb, how could the same God create a destructive creature like the Tyger and on the other hand create a gentle animal, the lamb. This ties into the theme of the

Mergers and acquisitions on the tata group - Free Essay Example

Sample details Pages: 15 Words: 4432 Downloads: 5 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? Merger and acquisitions have emerged as chief forces in the contemporary financial and economic environment. They have been a source of corporate growth and in India, it has changed radically after the liberalization of Indian economy. Mergers and acquisitions came up as one of the most efficient methods of such corporate restructuring, and became an essential part of the long-term trade strategy of corporates in India. The sole three chief objectives at the back any MA transaction were found to be: Don’t waste time! Our writers will create an original "Mergers and acquisitions on the tata group" essay for you Create order ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Improving Profitability ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Rapid growth in scale and closer time to market ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¢ Acquirement of new technology Many in corporate India would be jealous of the Tata Groups strategy around mergers and acquisition. In the past 8 years, the Tata Group had made 35 overseas acquisitions, including coal and iron ore mines, adding up Rs 78,000 crore, mostly in the past 3 years. Research problem To examine the consequence of going global through mergers and acquisitions and the traders long term and short term earnings respectively. This would aid in studying the impact on companies financials past the merger or acquisition. To also determine the enterprise value of the corporation by comparing it with the peer group and studying the value of the firm Objective of the study To analyze the a thorough detailed case study of 3 companies of Tata Group who merged or acquired in the past years. To evaluate the closing price of 3 companies previous to and post acquisition To weigh up the key financial ratios of 3 companies pre and post acquisition To do valuation of two companies through enterprise value and contrast the value with peer group and examine in detail Review of literature The following are the few existing studies reviewed which were conducted by researchers in the view of analyzing the financial performance during merger activity in different time periods. The study entitled Effect of mergers on corporate performance in India, written by Vardhana Pawaskar (2001), studied the impact of mergers on corporate performance. It compared the pre- and post- merger operating performance of the corporations involved in merger between 1992 and 1995 to identify their financial characteristics. The study identified the profile of the profits. The regression analysis explained that there was no increase in the post- merger profits. The study of a sample of firms, restructured through mergers, showed that the merging firms were at the lower end in terms of growth, tax and liquidity of the industry. The merged firms performed better than industry in terms of profitability. Mansur.A.Mulla (2003) in his case study Forecasting the viability and operational efficiency by use of ratio analysis: A case study, assessed the financial performance of a textile unit by using ratio analysis. The study found that the financial health was never in the healthy zone during the entire study period and ratio analysis highlighted that managerial incompetence accounted for most of the problems. It also suggested toning up efficiency and effectiveness of all facets of management and put the company on a profitable footing. Pramod Mantravadi and Vidyadhar Reddy (2007) in their research study Mergers and operating performance: Indian experience, attempted to study the impact of mergers on the operating performance of acquiring corporate in different periods in India, after the announcement of industrial reforms, by examining some pre- and post-merger financial ratios, with chosen sample firms, and all mergers involving public limited and traded companies of nation between 1991 and 2003. The study results suggested that there are minor variations in terms of impact on operating performance following mergers in different intervals of time in India. It also indicated that for mergers between the same groups of companies in India, there has been deterioration in performance and returns on investment. A book entitled Mergers acquisitions in the banking sector- The Indian scenario, written by Selvam. M (2007) has analyzed the implications of stock price reactions to mergers and acquisitions activities taken place in banking industry with special reference to private and public sector banks. The author has found from the analysis that the share prices are market sensitive. From the financial analysis it was observed that majority of the banks went for branch expansion and this has affected profitability to some extent and it resulted in unhealthy competition among the players. To sum up the review of literature, many contributions have offered different perspectives of merger in different industries worldwide and explained the valuation techniques followed by merging companies, and shareholders wealth effect due to merger. From the review of many excellent research papers analyzing the pre and post merger performance of merged companies, it is inferred that majority of the studies strongly support the concept of enhanced post merger performance due to merger and it is beneficial to the acquirer companies. METHODOLOGY Methodology of the study Sample selection There are several mergers within the TATA Group during the study period from 01.04.2006 to 31.03.2009. For the purpose of corporate analysis, it was decided to select two of the highest deals which merged within under the TATA Group during the study period. Hence, the sample size of this study is confined to 2. Besides, while selecting the sample, following points were taken into account. Acquirer and target companies should belong to the same industry. Availability of merger date and industry information. The details of sample companies, (Acquirer and Target), along with the date of merger and name of the Industry concerned are given in Table 1. Period of the study For the purpose of selecting sample companies, the present study covers a period of one year from April 1, 2006 to March 31, 2009. But in order to evaluate the financial performance of sample companies on a comparative basis, 15-20 days before merger and after merger were considered. Sources of data The present study basically depends on secondary data. The required data on financial performance before and after merger were collected and they were obtained from Prowess software, Internet sources, Business Journals (ICFAI JOURNAL ON M A) The data were also collected from books, journals, magazines and newspapers. Tools used In order to study the liquidity performance of acquirer and target companies, ratios Debt-Equity Ratio, ROCE (%),net profit margin, P/E, EPS, OPM(%) and valuation. (1) Analysis of financial performance Empirical tests were carried out on the collected financial data with the help of ratio analysis, t-test and standard deviation. The pre-merger average performance of the acquirer and target companies were compared with the post- merger performance of the combined firm. The present study attempts to measure and analyze the pre and post merger performance of acquirer and target companies by using financial ratios in order to ascertain whether mergers resulted in shareholders wealth or not. Accordingly, the following null hypothesis has been tested: H0: The post merger financial performance of the combined firm is not significantly different from the aggregate performance of the acquirer and target companies prior to the merger. (2) Ratios Debt-Equity Ratio : A measure of a companys financial leverage calculated by dividing  its total liabilities  by  stockholders equity. It indicates what proportion of equity and debt the company is using to finance its assets. ROCE : ROCE compares earnings with capital invested in the company. It is similar to Return on Assets (ROA), but takes into account sources of financing Net profit margin: The profit margin tells you how much profit a company makes for every1 Rupee it generates in revenue or sales. Profit margins vary by industry, but all else being equal, the higher a companys profit margin compared to its competitors, the better. P/E: It is a measure of the price paid for a share relative to the annual net income or profit earned by the firm per share. EPS: The portion of a companys profit allocated to each outstanding share of common stock.  Earnings per share  serves as an indicator of  a companys profitability. OPM: Operating margin is a measurement of the proportion of a companys revenue that is left over after variable costs of production such as wages, and raw materials have been paid. A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on debt. Also known as operating profit margin and net profit margin. (3) Enterprise Value Enterprise value is a figure that, in theory, represents the entire cost of a company if someone were to acquire it. Enterprise value is a more accurate estimate of takeover cost than market capitalization because it takes includes a number of important factors such as preferred stock, debt, and cash reserves that are excluded from the latter metric. ANALYSIS OF DATA TATA GROUP OF COMPANIES One of the Indias largest business groups in the country. It has about 96 operating companies. Diverse business in 7 sectors. Revenues equivalent to 5.3% of Indias GDP. Group revenue FY 2008: Rs 251,543 Cr. / $ 62.5 b. Group profit FY 2008: Rs 21,578 Cr. / $ 5.4 b .Its 27 publicly listed companies have a combined market capitalization which is the 2nd highest among all business houses in India. Largest employer in private sector over 300,000 employees. A shareholder base of over 2.9 million. Operations in over 80 countries. Products and services exported to 85 countries Tata is a rapidly growing business group based in India with significant international operations. Revenues in 2007-08 are estimated at $62.5 billion (around Rs251, 543 crore), of which 61 per cent is from business outside India. The group employs around 350,000 people worldwide. The Tata name has been respected in India for 140 years for its adherence to strong values and business ethics. The business operations of the Tata group currently encompass seven business sectors: communications and information technology, engineering, materials, services, energy, consumer products and chemicals. The groups major companies are beginning to be counted globally. Considering two of the largest mergers of TATA Group -Tata Steel became the sixth largest steel maker in the world after it acquired Corus. -Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers. TATA STEEL-CORUS About the acquisition Date: 30th March 2007 Acquirer: Tata Steel Limited Target company: Corus Plc. Stake: 100 % Deal amount: US$ 12201 m Sector: Steel sector MERGER On January 31, 2007, India based Tata Steel Limited (Tata Steel) acquired the Anglo Dutch steel company, Corus Group Plc (Corus) for US$ 12.20 billion. The merged entity, Tata-Corus, employed 84,000 people across 45 countries in the world. It had the capacity to produce 27 million tons of steel per annum, making it the fifth largest steel producer in the world as of early 2007. Before the acquisition, the major market for Tata Steel was India. The Indian market accounted for sixty nine percent of the companys total sales. Almost half of Corus production of steel was sold in Europe (excluding UK). The UK consumed twenty nine percent of its production. After the acquisition, the European market (including UK) would consume 59 percent of the merged entitys total production. DEAL : An auction was initiated on January 31, 2007, and after nine rounds of bidding, TATA Steel could finally clinch the deal with its final bid 608 pence per share, almost 34% higher than the first bid of 455 pence per share of Corus. Synergies There were many likely synergies between Tata Steel, the lowest-cost producer of steel in the world, and Corus, a large player with a significant presence in value-added steel segment and a strong distribution network in Europe. Among the benefits to Tata Steel was the fact that it would be able to supply semi-finished steel to Corus for finishing at its plants, which were located closer to the high-value markets The Pitfalls Though the potential benefits of the Corus deal were widely appreciated, some analysts had doubts about the outcome and effects on Tata Steels performance. They pointed out that Corus EBITDA (earnings before interest, tax, depreciation and amortization) at 8 percent was much lower than that of Tata Steel which was at 30 percent in the financial year 2006-07 COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION FINDINGS As we can see from the line chart that the %cumulative abnormal return before acquisition was sharply decreasing since past month with not even a single glimpse of positive return on any single day. But as soon as the acquisition took place, the earnings showed a marginal rise and again got back to the level where it was just before the acquisition. This happened due to very large debt generated due to overpaying by acquiring the Corus at a very high price of 608 pence per share as compared to previously valued 455 pence per share. RATIO ANALYSIS TATA Steel (31st Jan 2007) Pre-acquisition Post-acquisition Change ( %) Debt-Equity Ratio 0.31 0.67 116. ROCE (%) 50.13 23.27 -53.6 net profit margin 20.46 21.36 4.4 P/E 8.72 11.35 30.2 ROE(%) 41.7 25.97 -37.7 EPS 61.51 61.06 -0.7 OPM(%) 39.79 36.11 -9.2 INTERPRETATION Debt equity ratio on post acquisition increase because Corus debt was high it was GBP1.6b to buy Corus and so its debt is almost 116% more than in pre acquisition. ROCE shows that post acquisition is very less as compared to pre acquisition it has negative percentage because company has short term returns after one year it will improve in the long run. Net profit margin has very less change as profit is not much affected. P/E increases in post acquisition by 30.2% which show high future cash flow. ROE is decreasing by 37.7 which show that it has more debt than equity. EPS has a very minor change. Operating profit margin is reduced by 9.1% which shows that it has low profit. TATA COMMUNICATION-NTT DOCOMO About the acquisition Date: 13th November 2008 Acquirer: Ntt-Docomo Target company: Tata Teleservices Ltd. Stake: 26 % Deal amount: US$ 2700 m Sector: Tele-communication MERGER Tata Teleservices has sold a stake of 26% to Japans NTT DoCoMo. The deal value is $2.7 bn. Tata Tele has 30 million CDMA subscribers and is rolling out its GSM services. Some say the deal is over-valued and some say its not easy to put value on the fastest growing mobile market in the world. India is the fastest growing market second only to China. It adds 10mn subscribers every month. The current subscriber base stands at 300+million and is expected to be 700 million in 2012. That is almost double to todays numbers. The Road ahead Great deal it may be, but it has its risks. One reason is that telecom deals have been controversial in recent times. This goes back to late last year when the government sold pan-India licenses for $333 million apiece, amid a welter of controversy. DoCoMo, in accordance with regulations of the Securities and Exchange Board of India, expects to make an open offer to acquire up to 20 per cent of outstanding equity shares of Tata Teleservices Maharashtra (TTML), a Tata telecommunication company, through a joint tender offer along with Tata Sons. TTSL and TTML through the Tata Indicom brand, have increased their combined share of the fast-growing Indian mobile market and their combined subscriber base now stands at over 30 million. TTSL expects to leverage DoCoMos expertise in the development and delivery of value-added services, where DoCoMo is a firmly established market leader. RATIO ANALYSIS TATA DOCOMO (13-11-08) Pre- acquisition Post- acquisition Change (%) Debt-Equity Ratio 0.11 0.14 27.27% ROCE (%) 7.33 7.44 1.50% net profit margin 9.55 10.61 11.10% P/E 0 12 0 ROE(%) 11.14 10.97 -1.53% EPS 0.89 1.11 24.72% OPM(%) 16.2 18.7 15.43% FINDINGS Debt equity ratio on post acquisition debt is increasing which shows company debt is increasing after merger. ROCE is constant it has not change much.Net profit margin increases by 11.10 as it income increases in post acquisition as compared to pre acquisition. P/E highly increases in post acquisition from 0 to 12%. ROE is decreasing by 1.53% which shows that it slightly more debt than equity. EPS is increasing drastically by 24.27% which is very profitable for investors. Operating profit margin is increased by 15.43% which shows that company profit margin is very fairly profitable. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION The return of the target company Tata Communication has been very poor since the past 15 to 20 days before the acquisition but it almost got to break-even soon after the acquisition date. This sustained for the next 8 to 10 days but again got back into negative returns zone due to poor customer support to the newly entered Docomo brand in highly competitive communications market in India. TATA MOTOR JLR About the acquisition Date: 27th March 2008 Acquirer: Tata Motors Ltd Target company: Jaguar Land Rover Stake: 100 % Deal amount: US$ 2300m Sector: Automotive Detailed Case Study In June 2008, India-based Tata Motors Ltd. announced that it had completed the acquisition of the two iconic British brands Jaguar and Land Rover (JLR) from the US-based Ford Motors for US$ 2.3 billion. Tata Motors stood to gain on several fronts from the deal. One, the acquisition would help the company acquire a global footprint and enter the high-end premier segment of the global automobile market. After the acquisition, Tata Motors would own the worlds cheapest car the US$ 2,500 Nano, and luxury marquees like the Jaguar and Land Rover. Though there was initial skepticism over an Indian company owning the luxury brands, ownership was not considered a major issue at all. According to industry analysts, some of the issues that could trouble Tata Motors were economic slowdown in European and American markets, funding risks, currency risks etc. The Challenges Morgan Stanley reported that JLRs acquisition appeared negative for Tata Motors, as it had increased the earnings volatility, given the difficult economic conditions in the key markets of JLR including the US and Europe. Moreover, Tata Motors had to incur a huge capital expenditure as it planned to invest another US$ 1 billion in JLR. This was in addition to the US$ 2.3 billion it had spent on the acquisition. Tata Motors had also incurred huge capital expenditure on the development and launch of the small car Nano and on a joint venture with Fiat to manufacture some of the companys vehicles in India and Thailand. This, coupled with the downturn in the global automobile industry, was expected to impact the profitability of the company in the near future CURRENT SCENARIO In less than three years after its acquisition, Jaguar Land Rover has metamorphosed from a millstone around Tata Motors neck into its crowning jewel. In the June 2010 quarter, JLR division accounted for nearly 70% of the companys net profit and over 60% of its revenues on the consolidated basis. This was more than what the market has expected and the stock is up by nearly 150% in the past two trading sessions. JLR benefited from an improvement in its pricing power and a favourable exchange rate in the US dollar and the euro. The two worked in tandem and resulted in a sharp 60% jump in JLR revenue per unit to around 38,000 in June 2010 quarter compared to the 23,800 a year ago. With the raw material costs remaining benign, it led to a sharp improvement in the divisions operating margin and its reported net profit of 221 million (`1,613.3 crore) in the first quarter as against a net loss of 64 million (`467 crore) a year ago. RATIO ANALYSIS TATA MOTORS(27- 03 2008) Pre-acquisition Post- acquisition Change (%) Debt-Equity Ratio 0.56 0.97 42.27 ROCE (%) 30.52 6.88 -343.60 net profit margin 6.88 11.47 40.02 P/E 15.45 9.59 -61.11 ROE(%) 30.98 5.34 -480.15 EPS 47.1 18.81 -150.40 OPM(%) 11.16 7.89 -41.44 FINDINGS Debt equity ratio is increasing by 42.27% as Tata took loan of banks to acquire JLR.ROCE increases vey high by 343.60% as compared to pre acquisition as it gauges that company that generate its earnings from the total pool of capital which indicates profitability.Net profit margin increases as it income increases in post acquisition as compared to pre acquisition. P/E highly decreases in post acquisition by 60.1% which in investor point of view they will be profitable to invest to get high earning. ROE is highly increasing by 480.15% which shows that it has more equity than debt. EPS is increasing drastically by 480.15% which is very profitable for investors. Operating profit margin is reduced by 41.44% which shows that company profit margin is very less. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION As we can see from the line chart that the cumulative return before merger was negative and the entire trend is moving in the negative direction due to poor returns of tata motors. A soon as the acquisition took place, the highly profit generating Jaguar as well as Land Rover added to the profit and earnings of the tata motors. The brand value of JLR added to the highly reputable Tata Group and the companys balance sheet. This can be clearly seen in the line chart above. VALUATION AND INTERPRETATION EV Multiples of Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 1.17x compared to the deal of 0.68x of Corus Groups sales. This can be possible due to high sales value, reducing the multiple to 0.68x. The lowest multiple (Steel Authority of India) is at 0.73x. EBITDA Multiple: EBITDA multiple of its peers averages at 4.38x compared to the deal multiple of 7.02x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple. It can be observed that Tata played very aggressively. EBIT Multiple: EBIT multiple of its peers averaged at 5.54x compared to the deal of 10.19x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 8.39x. PE Multiple: The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers. The average PE multiples is 7.95x compared to 68.23x at which the deal haapened. EV Multiples of Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docmo. EBITDA Multiple: Again the average EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. EBIT Multiple: EBIT multiple of its peers is 25.5x compared to the deal of 952.96x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 41.02x. PE Multiple: The PE multiple for Tata Teleservices is negative as its net income is negative Note: The multiples are high on account that Sales and the profitability of Tata Teleservices is low, inturn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. FINDINGS FROM VALUATION OF ENTERPRISE VALUE MULTIPLE Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple It can be observed that Tata played very aggressively as it paid high enterprise value as compared to our analysis. A reason for Corus to be sold is chance to Bail out of Debt and Financial stress. TATA Steel Paid 7.02 Times EBITDA of Corus Enterprise Value. The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers the only company who has high P/E is Jindal steel. Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docomo. The PE multiple for Tata Teleservices is negative as its net income is negative. EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. The multiples are high on account that Sales and the profitability of Tata Teleservices is low, in turn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. SUMMARY Except Tata Steel- Corus deal, all the other 2 acquisitions was well accepted by not only well accepted by the owners of the company (the shareholders) but even made the entire Tata group come into the eyes of fortune 500 list. In-fact it ranked at 56th position at a global level in 2009 CONCLUSION This study was undertaken to test what is the impact of mergers on the financials of acquiring corporate by examining some pre- merger and post-merger financial, in terms of impact on operating performance. The results from the analysis of pre- and post-merger operating performance ratios for the acquiring firms in the sample showed that there was a differential impact of mergers, for different industry sectors in India. Type of industry does seem to make a difference to the post-merger operating performance of acquiring firms. Expansion through mergers and acquisition is one of the best ways for any domestic company to step outside the shores of India in an international market place and acquit itself as a global player Company can turn into conglomerate in reasonably less time by capitalizing on its strengths of efficiency and effectiveness by acquiring relatively poor performing companies as TATA did in almost all its group of companies Recent examples of companies which adopted similar pattern of expansion are Renuka Sugars, Arcelor Mittal, Reliance, Essar Group, Aditya Birla Group, etc. One can study any of the above mentioned company and conclude that the key underlying decision of these companies expanding quickly and efficiently is their timely decision of merging and acquiring appropriate companies