Q 11. Enumerate the differences between a friendly and hostile takeover?
Ans:
Friendly Takeover
 A friendly takeover also called an
acquisition, occurs when the acquiring
company informs the target
company’s board of directors that it
plans to purchase a controlling
interest.
 The board of directors then votes on
the proposed buyout.
 If the board believes the stock
purchase would benefit the current
stockholders, they vote in favor of the
sale. The Acquiring company then
takes control of the target company’s
operations and may or may not choose
to keep the target company’s board of
directors in place.
 In a friendly takeover , can employ
strategies such as: Offering their own
shares or cash , Offering a share
price premium.
 Example:
Let’s assume that ICICI bank who is
interested in buying a majority in
Bank of Rajasthan. ICICI makes a
plan to approach Bank of Rajasthan’s
Hostile Takeover
 A hostile takeover happen when the
target company’s board of directors
votes down the stock sale to the
acquiring company.
 Agents of the acquiring company then
attempt to purchase the target
company’s stock from other sources,
gain a controlling interest and force
out the board members who voted
against the acquisition.
 When this happens, the acquiring
company will aggressively go after
shares of the target firm, while the
target’s board of directors prepares to
fight for survival.
 In a hostile takeover , can employ
strategies such as: Tender Offer,
Proxy Fight.
 Example:
Most popular hostile takeover is AOL
and Time warner. When AOL
announced it was taking over the
much larger and larger and successful
 board of directors with a potential bid. Time Warner, it was touted as one of
Bank of Rajasthan’s board of directors the biggest deals of the period.
would then discuss on the bid or votes
on the bid. If Bank of Rajasthan
management evaluate that the deal is
beneficial to the company, they will
accept the offer and recommend the
deal to shareholders as well. After all
the approvals from a board of
directors, shareholders and other
regulatory authorities involved, the
deal will be finalized.

Q 1. What is the motive behind the acquisition of these organizations by ICICI Bank?

Ans:

Based on the cases, we can narrow down the motives behind the acquisition to the following:

 Growth – Organic growth takes time and dynamic firms prefer acquisitions to grow
quickly in size and geographical reach.
 Synergy – The merged entity, in most cases, has better ability in terms of both revenue
enhancement and cost reduction.
 Managerial efficiency – Acquirer can better manage the resources of the target whose
value, in turn, rises after the acquisition.
 Strategic Motives – Two banks with complementary business interests an strengthen
their positions in the market through merger.
 Market Entry – Cash rich firms use the acquisition route to buyout an established player
in a new market and then build upon the existing platform.
 Tax shields and financial safeguards – Tax concessions act as a catalyst for a strong
bank to acquire distressed banks that have accumulated losses and unclaimed
depreciation benefits in their books.
  Regulatory Intervention – To protect depositors, and prevent the destabilization of the
financial services sector, the RBI steps in to force the merger of a distressed bank.

Q 3. What are the different types of mergers? To which type of merger do these mergers
belong?

Ans:

Part 1

Types of Mergers:

The following are the types of mergers:

 Horizontal Merger – Merger between the companies that are operating in the same
industry having competition and share the same product lines and markets.
 Vertical Merger – Merger between two companies operating at different level of
production stages or value chain, like a customer and company or a supplier and
company.
 Congeneric Merger – Merger between two businesses that serve the same consumer
base in different ways are called concentric mergers.
 Market Extension Merger – When two companies that sell the same products in
different markets are merged, the merger is called a market extension merger.
 Product Extension Merger – If two companies selling different but related products in
the same market are merged, it is called a product extension merger.
 Conglomerate Merger – If a company in the paper industry merged with a member of
cement industry, between two companies that have no common business areas or
between the unrelated industries, it is called a conglomerate merger.

Part 2

There are two types of mergers do these merger belong:

 Horizontal Merger : It refers to two firms operating in same industry or producing ideal
products combining together. The main objectives of horizontal mergers are to benefit
 from economies of scale, reduce competition, achieve monopoly status and control the
market.
When two or more firms combine certain benefits are realized as a result of larger
volumes of operation of the combined entity. This refers to the fact that the combined
company can often reduce its fixed costs by removing duplicate departments or
operations, lowering the costs of the company thus increasing profit margins.
 Forward Merger : In a forward merger, the target merges into the buyer. When ICICI
Bank acquired Bank of Madura, Bank of Madura which was the target, merged with the
acquirer, ICICI Bank.
This makes it easier to integrate the two companies during and after the merger, and
preserve the buyer’s business continuity. Forward mergers may also require the buyer’s
shareholders to approve the transaction, making it more time-consuming and complex.

Q 2. What are the post-merger benefits to ICICI Bank? Analyze in details at least 3 cases.

Ans:

Part 1

Post-merger Benefits to ICICI Bank:

 Scale – ICICI Bank merger helps your institution scale up quickly and gain a large
number of new customers instantly. Not only does an acquisition give your bank more
capital to work with when it comes to lending and investments, but it also provides a
broader geographic footprint in which to operate. That way, you achieve your growth
goals quicker.
 Efficiency – Acquisitions also scale your bank more efficiently, not just in terms of your
efficiency ratio, but also in terms of your banking operations. Every bank has an
infrastructure in place for compliance, risk management, accounting, operations and IT –
and now that two bank have become one, you’re able to more efficiently consolidate and
administer those operational infrastructures.
 Business Gaps Filled – Bank mergers and acquisitions empower your business to fill
product or technology gaps. Acquiring a smaller bank that offers a unique revenue model
or financial product is sometimes easier than building that business unit from scratch.
 And, from a technology perspective, being acquired by a larger bank might allow your
institution to upgrade its technology platform significantly.
 Talent and Team Upgrade – While not a factor on the balance sheet, every bank
benefits from a merger or acquisition because of the increase in talent at leadership’s
disposal. An acquisition presents the possibility of bolstering your sales team or
strengthening your team of top managers, and this human element should not be ignored
or downplayed.

Part 2

Analyze in details at least 3 cases:

 Amalgamation of Bank of Madura

For over 57 years, Bank of Madura (BoM) operated as a profitable entity in Indian Banking
Industry. It had a significant coverage in the southern states of India. It had extensive network of
263 branches across India. The bank had total assets of Rs. 39.88 billion and deposits of Rs.
33.95 billion as on September 30, 2000. It had a capital adequacy ratio of 15.8% as on March 31,
2000. With a view to expanding its assets, client base and geographical coverage, ICICI Bank
was scouting for private banks for merger. In addition to that, its technological up gradation was
inching upwards at snail’s pace. In contrast, BoM had an attractive business per employee figure
of Rs. 202 lakh, a better technological edge, and a vast base in southern India as compared to
Federal Bank. While all these factors sound good, a tough and challenging task in terms of
cultural integration and human resources issues lay ahead for ICICI Bank.

With these considerations, ICICI Bank announced amalgamation with the 57 year BoM, with
263 branches, out of which 82 were operating in rural areas; the majority of them were located in
southern India. As on December 9, 2000, on the day of announcement of the merger, the Kotak
Mahindra group was holding about 12% stake on BoM, the Chairman of BoM, Mr. K. M.
Thaigarajan, along with his associated, was holding about 26% stake, Spic group had about
4.7%, while LIC and UTI were having marginal holdings. This merger was supposed to increase
ICICI bank’s hold on the South Indian market. The swap ratio was approved to be at 1:2.

 Amalgamation of Sangli Bank

Sangli Bank Ltd. was an unlisted private sector bank headquartered at Sangli in the state of
Maharashtra, India. As on March 31, 2006, Sangli Bank had deposits of Rs. 20.04 billion,
advances of Rs. 8.88 billion, net NPA ratio of 2.3% and capital adequacy of 1.6%. The Board of
Directors of ICICI Bank Ltd. and the Board of Directors of The Sangli Bank Ltd. at their
respective meetings approved an all-stock amalgamation of Sangli Bank with ICICI Bank on
December 09, 2006. The deal was in the ratio of one share of ICICI Bank for 9.25 shares of the
privately-owned, non-listed Sang.

The proposed amalgamation was expected to be beneficial to the shareholders of both entities.
ICICI Bank would seek to leverage Sangli Bank’s network of over 190 branches and existing
customer and employee base across urban and rural centers in the rollout of its rural and small
enterprise banking operations, which were key focus areas for the Bank. The amalgamation
would also supplement ICICI Bank’s urban distribution network. The amalgamation would
enable shareholders of Sangli Bank to participate in the growth of ICICI Bank’s strong domestic
and international franchise.

 Amalgamation of the Bank of Rajasthan Ltd.

The Bank of Rajasthan Ltd. was incorporated on May 7, 1943 as a Company defined under the
Companies Act, 1956 and has its Registered Office at Raj Bank Bhawan, Clock Tower, Udaipur,
and Rajasthan. The Bank of Rajasthan had a network of 463 branches and 111 automated teller
machines (ATMs) as of March 31, 2009. The primary object of the Transferor Bank was banking
business as set out in its Memorandum of Association. For over 67 years, the Bank of Rajasthan
had served the nation’s 24 states with 463 branches as a profitable and well-capitalized Bank. It
had a strong presence in Rajasthan with branch network of 294 that is 63 percent of the total
branches of BoR with men power strength of more than 4300. The balance sheet of the Bank
shows that it had total assets of Rs. 173 billion, deposits of Rs. 150.62 billion, and advances of
Rs. 83.29 billion as on March 2010. The profit and loss account of the bank shows the net profit
as Rs. -1.02 billion as on March 2010, which shows that bank, was not in good financial
condition.

The objectives and benefits of this merger are clearly mentioned in the scheme of this merger by
ICICI Bank its customer centric strategy that places branches as the focal points of relationship
management, sales, and service in geographical micro markets. As it is evident that the BoR had
deep penetration with huge brand value in the State of Rajasthan where it had 294 branches with
a market share of 9.3% in total deposits of scheduled commercial banks.

It was presumed that the merger of BoR in ICICI Bank will place the Transferee Bank among the
top three banks in Rajasthan in terms of total deposits and significantly augment the Transferee
Bank’s presence and customer base in Rajasthan and it would significantly add 463 branches in
branch network of ICICI Bank along with increase in retail deposit base. Consequently, ICICI
Bank would get sustainable competitive advantage over its competitors in Indian Banking.

Q.8.What are the differences between a development bank and a commercial bank?
Why India required development banks at post-independence period?
Ans:
Part 1
Development Bank Commercial Bank
 Aim at achieving social profit  Aim at profit-making through
by undertaking developmental lending at a high-interest rate.
projects.
 Set up under the special act  Set up as companies under the
passed by the government. Company Act.
 Lends the government.  Targets individuals and
business entities.
 Are multi-purpose institutions.  Are financial institutions.
 Source funds by borrowing,  Raise funds through public
selling securities or grants. deposits.
 Targets the development sector.  Targets individuals and
business entities.
 Provide medium and long-term  Provide short-term and
loans. medium-term loans.
 Do not offer cheque facilities.  Provide cheque facilities to
enable the making and
withdrawal of deposits.

Part 2
The Development Banks are playing a significant role in providing financial support to the
program of rapid industrialization of the country. They are providing long term assistance to the
Indian industry. They have 64 become a major source of finance to the Indian Corporate Sector.
Today, hardly any industrial project can come up without the financial assistance from such
institutions. 30 The Development Banks are offering the following financial services:

1. Granting rupee and foreign currency loans.

2. Subscribing directly to the shares, bonds and debentures of industrial concerns.

3. Underwriting the issue of shares, bonds and debentures issued by industrial concerns.

4. Guaranteeing:

a) loans raised by industrial concerns from domestic and foreign sources.

b) deferred payments in respect of import of machinery from foreign countries or

purchased domestically, and

c) Issuing bonds, shares and debentures.

5. Providing refinancing and rediscounting facilities to the approved financial institutions. These
banks are further analyzed quantitatively in terms of institution-wise, purpose-wise assistance,
sector-wise assistance, assistance to backward areas, state-wise assistance and industry-wise
assistance.

Q.10.What are the different forms in which an acquisition can take place?
Ans:
There are several types of acquisition, but most come under one of four categories: Management
Acquisition, Asset Acquisition, Tender Offer, and Consolidation.

Management Acquisition:

Management Acquisition sounds like one company head-hunting the management of another, but
this is not what it means. Management Acquisition occurs when either an existing executive or
ex-executive purchases enough shares to take control of a company. This process often results in
the said company becoming a private business rather than being shareholder-oriented.

Also known as a Managerial-led Buyout, this often occurs when a business founder buys back
control of a company they started. It can also be performed by board members who have a long
connection or great track-record in leading the business.
The acquisition is made only through shareholder agreement. Usually, there is a shares threshold
which must be met in order for the deal to go through. This means that x percent of shareholders
must sell their shares to the buyer so they can take control – normally 50% or more.

The benefit to shareholders is that some will generate income from selling their shares, while
those who remain shareholders will have someone they trust to steer the business. A negative
side to Management Acquisition is that it is often funded through third party financiers with the
debt shifted onto the business.

Asset Acquisition:

An Asset Acquisition is performed when the buyer wishes to purchase some or all of a company’s
assets. However, the company itself is not purchased. For example, a car dealership may have 10,000
cars in its inventory. An Asset Acquisition could be to purchase the car stock but not the business.

Another example would be in acquiring intellectual property. Patents for a specific product or range
could be acquired or even a brand name.

Asset Acquisitions are usually carried out when a target business is failing or going into bankruptcy.
A bidding war unfolds for said company’s assets. The business then either uses this income to prop
up the business or is then liquidated by administrators. In the latter case, shareholders get some return
on their shares or the money is used to pay creditors.

Tender Offer:

A Tender Offer happens when a company buys existing shares from another business. The buyer
must “tender” an offer first. This must be done publicly, with the offer made to a target
company’s shareholders. In some cases, the boardroom may disagree with this offer but the
shareholders embrace it. This then becomes a hostile process.

A Tender Offer is often the result of shareholders being dissatisfied with a board’s performance
or running of their company.
The Securities and Exchange Commission has strict regulations for a Tender Offer. They require
that any acquisition of a target company for 5% or more of its shares must be divulged to the
Securities and Exchange Commission before being legally verifiable. The buyer must also
announce this acquisition to the trading stock exchange.

Like a Management Acquisition, the success of this process is predicated on an agreed share
threshold. If too few shares are sold, the process is null and void.

Often, there is no no-shop clause here. The buyer can sell the assets or business itself after
purchase.

Consolidation:

A consolidation creates a new company. Stockholders of both companies must approve the
consolidation, and subsequent to the approval, they receive common equity shares in the new
firm. For example, in 1986, merger of Hindustan Computers Limited and Hindustan Instruments
Limited, both are associated with IT industry, combined a new company, HCL Limited.

Q.4.Explain the different phases of merger as applicable to these mergers.

Ans:
A merger can be distinguished in the following phases:
Pre-merger Phase:
 Financial position of transferor company - Transferor company means
the company which is amalgamated into another company. The company is not listed in
Indian Stock Exchanges and hence the provisions of Securities and Exchange Board of
India relating to listed companies are not applicable to the company.
 Market Value –

X Ltd. is considering the proposal to acquire Y Ltd. and their financial information is given
below :

Particulars X Ltd. Y Ltd.

No. of Equity shares 10,00,000 6,00,000
 Market price per share (Rs.) 30 18
Market Capitalization (Rs.) 3,00,00,000 1,08,00,000

X Ltd. intend to pay Rs. 1,40,00,000 in cash for Y Ltd., if Y Ltd.’s market price
reflects only its value as a separate entity. Calculate the cost of merger: (i) When
merger is financed by cash (ii) When merger is financed by stock.

(i) Cost of Merger, when Merger is Financed by Cash = (Cash - MVY) + (MVY -
PVY) Where,
MVY = Market value of Y Ltd.
PVY = True/intrinsic value of Y Ltd.
Then, = (1,40,00,000 – 1,08,00,000) + (1,08,00,000 – 1,08,00,000) = Rs. 32,00,000

If cost of merger becomes negative then shareholders of X Ltd. will get benefited by acquiring Y
Ltd. in terms of market value.

(ii) Cost of Merger when Merger is Financed by Exchange of Shares in X Ltd. to the
shareholders of Y Ltd.
Cost of merger = PVXY - PVY
Where,
PVXY = Value in X Ltd. that Y Ltd.’s shareholders get.
Suppose X Ltd. agrees to exchange 5,00,000 shares in exchange of shares in Y Ltd., instead of
payment in cash of Rs. 1,40,00,000. Then the cost of merger is calculated as below :
= (5,00,000 × Rs. 30) – Rs. 1,08,00,000 = Rs. 42,00,000
PVXY = PVX + PVY = 3,00,00,000 + 1,08,00,000 = Rs. 4,08,00,000

Proportion that Y Ltd.’s shareholders get in X Ltd.’s Capital structure will be :

= = 0.333

True Cost of Merger = PVXY - PVY

= (0.333 × 4,08,00,000) - 1,08,00,000 = Rs. 28,00,000
The cost of merger i.e., Rs. 42,00,000 as calculated above is much higher than the true cost of
merger Rs. 28,00,000. With this proposal, the shareholders of Y Ltd. will get benefited.

Brand Value –
Brand value is simply the sale or replacement value of a brand. This definition may be relevant
for investors and for folks who need to include a "goodwill" term in the right hand side of the
balance sheet. Such an accounting entry captures the net present value of long-term value, that is
created through the investments on brand assets. Note that having such an entry in the balance
sheet also enables managers to take brand related costs as not expenses but rather as investments
with a long-term pay-off.

Communication Issues –

Communication is generally viewed as a critical component in mergers and acquisitions (M&A)

performance, yet surprisingly little research has examined the link between different
communication approaches and M&A outcomes. This paper provides a systematic empirical
study to evaluate the link between communication approaches and M&As outcome. Specifically,
a typology is created to examine interaction between the process and content of communication
and M&A outcomes, in terms of employee commitment to merged organization strategy and
M&A survival. Using data drawn from a single clearly defined M&A wave in the Nigerian
banking sector, different communication practices are related to M&A outcomes. The findings
are the first to show the effects of communications practices in African M&A and answer the
calls for extending M&A research beyond western developed countries. They confirm the
importance of communication practices in M&A, extend earlier findings on the importance of
post-acquisition integration communication in US and European contexts and show the
importance of communicating throughout the whole M&A process.

Shareholders & other stakeholder’s view –

Stakeholders are not a single element influencing on the success of M&A execution. A number
of management researches have been discovered various determinants that effect a success of
deal and they influence together with stakeholders. To approach stakeholders’ impact more
precisely in empirical setting, other factors’ influence on the result should be considered in
advance and need to be appropriately prepared in methodological dimension.

Acquisition Phase:
Cost of merger & acquisition –

M&A transaction fees are 2.0% of the Purchase Price (i.e., the purchase of the Target's Equity),
or approximately $1.8 million. Financing fees include 4.0% of the $30 million in new Senior
Debt raised and 6.0% of the $60 million in new Equity raised. These fees will total $1.2 million
and $3.6 million, respectively.

Maintenance of customer relationships during integration phase –

This phase can take anywhere from 9 months to 2 years. According to the research, this
stage should begin with IT integrating operations and receiving new job assignments
followed by IT staff management, IT training, and creating an IT steadiness. In addition
to ensuring that all staff is equally trained and on the same page, this stage involves
managing the old systems and coordinating them with the new systems. So for example
Gartner tells us that most organizations have between 3 and 8 scheduling tools for
applications within their organization. This means after an M&A transaction takes place,
the organization will have between 6 and 16 scheduling tools to manage and coordinate.
In a situation like this, it would be most beneficial for an IT team to look to an  IT
Automation Solution that can consolidate and coordinate these scheduling tools to
centralize their IT environment.

Knowledge transfer among units that are to be integrated –

Despite the fact that M&As are a commonly applied strategy for organizations, there is no doubt
that they introduce substantial stress and turbulence in both acquiring and acquired companies. In
her thorough study, argues that the working environment can become rather uncertain and
uncomfortable. Such drastic changes can lead to employees’ resistance and initiation of job
resignations. The negative consequences can be particularly troublesome when the acquiring
party is attempting to transfer knowledge due to its inter-personal nature. In such cases tacit
knowledge proves to be even more challenging to transfer as it is embedded in individual
intuition, routines and processes. Empson researches two phenomena, which need to be
considered when transferring knowledge – the fear of exploitation and the fear of contamination.
Vaara, Stahl and Björkman express the same view. The fear of exploitation represents the
anxiety of individuals when they are confronted by stressful times such as M&As and when they
are required to provide their valuable knowledge. On the other hand, Mirc states that on an
individual level due to fear of contamination, employees can perceive the knowledge transfer as
giving away their control and power, which might turn into an impediment for the process. The
second phenomenon is fear of contamination, which originates from differences in quality
images of both firms. The individuals of the acquired company might be unwilling to provide
thorough information for their client relationships or knowledge if they perceive that the image
of the acquiring company does not match the one of their own. Mirc supports that view and adds
that the individual perception of the acquirer can impact significantly the desire to share
information. According to Empson it might be the case also that employees are unwilling to
share their knowledge from fear and other constraints. Therefore, the author builds her research
on the importance of individuals for the knowledge sharing processes in order for the articulation
of the knowledge in specific organizational context to be completed. Empson finds out that
commonly individuals make evaluations of advantages and disadvantages from sharing their
knowledge with the other party, which makes the process subjective and biased. The author
suggests further that in order to understand the complexity of such individual impediments of
knowledge transfer, “the process of knowing” needs to be taken into consideration, which
represents how each employee “shapes and is shaped by this process”.

Post-merger Phase:

 Corporate Culture
 Existing value systems
 Staff Qualification
 Stress Management
 Salary
 Technology
 HR Policy
 Leadership styles
 Core competencies
  Post integration
 Allocation of responsibility
 Language barriers and country specific cultural differences

Q.9.Explain at least one merger in pre-merger, acquisition and post-merger phases

Ans:

Pre-merger Phase:
 Financial position of transferor company - Transferor company means
the company which is amalgamated into another company. The company is not listed in
Indian Stock Exchanges and hence the provisions of Securities and Exchange Board of
India relating to listed companies are not applicable to the company.
 Market Value –
X Ltd. is considering the proposal to acquire Y Ltd. and their financial information
is given below :

Particulars X Ltd. Y Ltd.

No. of Equity shares 10,00,000 6,00,000
Market price per share (Rs.) 30 18
Market Capitalization (Rs.) 3,00,00,000 1,08,00,000

X Ltd. intend to pay Rs. 1,40,00,000 in cash for Y Ltd., if Y Ltd.’s market price
reflects only its value as a separate entity. Calculate the cost of merger: (i) When
merger is financed by cash (ii) When merger is financed by stock.

(iii) Cost of Merger, when Merger is Financed by Cash = (Cash - MVY) + (MVY -
PVY) Where,
MVY = Market value of Y Ltd.
PVY = True/intrinsic value of Y Ltd.
Then, = (1,40,00,000 – 1,08,00,000) + (1,08,00,000 – 1,08,00,000) = Rs. 32,00,000

If cost of merger becomes negative then shareholders of X Ltd. will get benefited by acquiring Y
Ltd. in terms of market value.
 (iv) Cost of Merger when Merger is Financed by Exchange of Shares in X Ltd. to the
shareholders of Y Ltd.
Cost of merger = PVXY - PVY
Where,
PVXY = Value in X Ltd. that Y Ltd.’s shareholders get.
Suppose X Ltd. agrees to exchange 5,00,000 shares in exchange of shares in Y Ltd., instead of
payment in cash of Rs. 1,40,00,000. Then the cost of merger is calculated as below :
= (5,00,000 × Rs. 30) – Rs. 1,08,00,000 = Rs. 42,00,000
PVXY = PVX + PVY = 3,00,00,000 + 1,08,00,000 = Rs. 4,08,00,000

Proportion that Y Ltd.’s shareholders get in X Ltd.’s Capital structure will be :

= 0.333

True Cost of Merger = PVXY - PVY

= (0.333 × 4,08,00,000) - 1,08,00,000 = Rs. 28,00,000
The cost of merger i.e., Rs. 42,00,000 as calculated above is much higher than the true cost of
merger Rs. 28,00,000. With this proposal, the shareholders of Y Ltd. will get benefited.

Brand Value –

Brand value is simply the sale or replacement value of a brand. This definition may be relevant
for investors and for folks who need to include a "goodwill" term in the right hand side of the
balance sheet. Such an accounting entry captures the net present value of long-term value, that is
created through the investments on brand assets. Note that having such an entry in the balance
sheet also enables managers to take brand related costs as not expenses but rather as investments
with a long-term pay-off.

Communication Issues –

Communication is generally viewed as a critical component in mergers and acquisitions (M&A)

performance, yet surprisingly little research has examined the link between different
communication approaches and M&A outcomes. This paper provides a systematic empirical
study to evaluate the link between communication approaches and M&As outcome. Specifically,
a typology is created to examine interaction between the process and content of communication
and M&A outcomes, in terms of employee commitment to merged organization strategy and
M&A survival. Using data drawn from a single clearly defined M&A wave in the Nigerian
banking sector, different communication practices are related to M&A outcomes. The findings
are the first to show the effects of communications practices in African M&A and answer the
calls for extending M&A research beyond western developed countries. They confirm the
importance of communication practices in M&A, extend earlier findings on the importance of
post-acquisition integration communication in US and European contexts and show the
importance of communicating throughout the whole M&A process.

Shareholders & other stakeholder’s view –

Stakeholders are not a single element influencing on the success of M&A execution. A number
of management researches have been discovered various determinants that effect a success of
deal and they influence together with stakeholders. To approach stakeholders’ impact more
precisely in empirical setting, other factors’ influence on the result should be considered in
advance and need to be appropriately prepared in methodological dimension.