How Emerging Giants Are Rewriting the Rules of M&a

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How Emerging Giants Are Rewriting the Rules of M&A Date : 12 February 2012 Agenda ► Introduction ► Hindalco's Global Ambition ► Climbing the M&A Comptency ► Two Approaches to M&A ► Lesson Learned from Each Acquisition ► Sticking to Strategc Acquisitions ► Allowing Integration to Evolve ► Conclusion INTRODUCTION Introduction How Emerging Giants Are Rewriting the Rules of M&A Merger One plus one makes 3 ►This equation is the special alchemy of a merger. The key principle behind buying companies is to create shareholder value. Acquisition ► A corporate action in which a company buys most, if not all, of the target company's ownership stakes in order to assure control of the target firm. ► Acquisition are often made as part of the company’s growth strategy whereby it is beneficial to takeover an existing firm’s operations and niche to expanding on its own. Hostile Takeover • Acquisition can be friendly or hostile. Friendly acquisition occur when the target firm expresses its agreement to be acquired, whereas hostile acquisition don’t have the same agreement from the target firm and acquiring firm needs to actively purchase large stakes of the target company in order to have a majority stake. • Acquiring company needs to offer a premium to entice the shareholders to sell their stocks. HINDALCO’S GLOBAL AMBITIONS Hindalco’s Global Ambitions Long term strategy for future Aluminium Product • Engaging Novelis • Selling aluminum product all over the world Aluminum producer • In the past, Hidalco has become the largest aluminium producer in India Aluminium Producer  In the past, Hindalco has become global leader on aluminum upstream market.  Has 40% share of the market Aluminium Products  Expanding the company by involving into downstream market  Lower currency appreciation, intense in domestic competition
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