Essay: Future Outlook of Mergers

Sample Essay

The article goes on to present the future outlook of mergers, acquisitions and hostile takeovers even with an economy recovering from recessionary conditions. This is due to the fact that major indicators of the economy show signs of recovery as share prices recover and credit lines open up. The author suggests that merger and acquisition deals are set to reach record levels as low share prices make companies more attractive for acquisitions. The example of Cadbury as a target to Kraft has been outlined in the article to show how companies try to acquire other companies and when deals do not work out they tend to takeover these companies through other sources in a hostile takeover. The article goes on to explain that there are various actions managers can take to defend their companies from hostile takeovers (Economist.com, 2009).

Conclusion

The article provides an overall perspective of mergers and acquisitions with a pattern of historical and current trends in these transactions. I is outlined that the current scenario and economic conditions provide several motives for companies to acquire other organizations. The article suggests that companies merged with or acquired other companies in order to gain higher profits but companies tend to acquire other companies not only based on higher profits but with clear business strategies. The article finally indicates that there is a high expectation of increased number of merger deals in the future but this number is expected to rise in a longer period of time.

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