Shareholder Value: A Business Experience

Chapter 12: Mergers and Acquisitions Major External Investments

" Acquisitions an aphrodisiac for so many", Jason thought to himself as he sat in his office. It had been almost a week since the OCS Value Driver Program review meeting. Now, the attention had moved to the two acquisitions that Val had mentioned over a month ago. These deals had been moving along and economic evaluations needed to be done. As Jason continued to ponder, he was almost speaking (softly) to himself " How amazing it is that so many companies underestimate the challenges in creating value through either merging with other firms or acquiring companies in part or whole. The ones that are successful have the merger and acquisition process down to a science with knowledgeable people dedicated to the various aspects of the M&A process. Now that Services is moving into the A category generating returns above the cost of capital Growthstar can at least move forward in pursuit of external growth. Their strategies seem to be reasonably well thought out and documented. Depending on the nature of the Leasing proposal, the two deals on the table can, possibly, be rationalized within the context of the corporation's direction. With the Services acquisition starting to pay off , this business unit may be able to create additional value for shareholders through another acquisition in the near future. It's going to be difficult, though, to match the returns for the NG Euro and OCS programs. Well, tomorrow we'll begin to...

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