Mergers and Acquisitions By Ryan T. Evans November 2001 Dr

1
Mergers and Acquisitions

• By
• Ryan T. Evans
• November 2001
• Dr. Gasper

2
Introduction to Risk Management of Mergers and
Acquisitions

• Some Facts
• Between 51 and 89 of all mergers fail
• Several Risks
• Easier, Anti-Trust Laws Much Less Strict

3

MA Broken Down

• Risk management in mergers and acquisitions.
• Mergers and acquisitions with insurance
  companies.
• Several Other Topic Areas

4
Risk Management with MA

• Before The Merger
• During The Merger
• After The Merger

5
Risk Management Teams Before(What do we hope the
M or A will Accomplish?)

• Assets More Money to Manage
• Liabilities More Debt to Deal With
• Laws/Accounting Principles How to Document the
  Money
• Dealing With Rumors
• IS IT WORTH IT?

6
Risk Management Teams During

• The Value of the Companys Stock
• Insider Trading
• Keeping the Company Moving Smoothly
• A Smooth Transition

7


Risk Management Teams After

• Management Changes Political
• Change in 401K
• Keeping Customers

8
What to Consider

• Single Industry What will this do to
  competition(Formica and Intl Paper).
• Cross-Industry Will This be feasible (General
  Electric)
• International What are the Legalities

9
Single Industry

• Reducing competition is the Main Issue.
• Is the Industry large Enough to Sustain a Merger
  or Acquisition
• What Exactly Will Be Gained
• CASH MANAGEMENT

10
Cross-Industry

• Different Types of Competition
• Management, Management, Management
• Must Prepare for the Merger

11
International MA

• Different Regulations
• Competition
• Knowledge
• Exchange Rates

12
EXAMPLES

• Paper Industry
• Quaker Oats/Pepsi
• AOL-Time-Warner

13
MA involving Insurance Companies

• The Logistics
• The Primary Company
• The Target Company
• The New company

14
EXAMPLES

• SUCCESS
• FAILURES
• DO NOT HAVE TO GO FAR

15
MA Involving Insurance Companies

• REINSURANCE

16
Conclusion

• Mergers and Acquisitions Seem to be the Future of
  Corporate America