ACQUISITIONS

Submitted by Rony Samson 1021924

ASIAN PAINTS Introduction:

BOMBAY - Asian Paints (India) Ltd., the largest paint manufacturer in India, announced plans to acquire a controlling 50.1% stake in Berger International Ltd., a Singapore-based coatings producer with operations in 11 countries in Asia, the Middle East and the Caribbean. Asian Paints said the acquisition will be its largest outside India, and will expand its operations to 23 countries. Berger International manufactures a variety of coatings, including protective, industrial and marine products. Asian Paints said the acquisition will make it one of the top 10 manufacturers of decorative coatings worldwide, and will provide entry into high-growth markets in China and Southeast Asia. Ashwin Dani, Asian Paints vice chairman and managing director, said the purchase is "in line with our vision of becoming a leading player in emerging markets." Berger International is reported to be the largest paint manufacturer in Bahrain, Jamaica, Malta, Barbados, and Trinidad & Tobago, and holds a major market position in the United Arab Emirates and Singapore. The company expanded its operations to China, Myanmar and Malaysia in the 1990s, but has not achieved a "significant presence in those countries," Asian Paints said. Asian Paints said it sells more than 200,000 metric tons of paint annually in domestic and export markets in Asia-Pacific, the Middle East and Africa.

Review of the Case:

Asian paints had 51% of shares of Berger International during the acquisition. The vice chairman of Asian Paints was clear about his strategies after the acquisitions. Dani had shut down three of the sub diaries and operating in markets that generate cash flows. During the acquisition in order to eliminate negativity among the employees they spend time with employees and worked as a team. They withdrew from markets that were stagnating. Localization was the next step incorporated by the company to understand the local market. A local workforce will make you understand operating environment and the consumer behaviour. Overseas ventures require the acquisition of local talent for the success. Next step is the integration of technology intellect and emotions. Of which emotional integration is the key. Communication plays a key role during acquisition. Next is implementing systems and process to make these operations effective. TATA MOTORS

Introduction:
The primary learning objective of this case is the evaluation of the factors that determine the success of an acquisition. Specifically, the objectives of this case are the following: 1. To evaluate the strategic interests of acquirers and targets and to examine how these interests affect the process and outcomes of an acquisition. 2. To illustrate the effective management of the many challenges that acquirers face in successfully bidding for and acquiring targets. 3. To illustrate an uncommon situation of how an Indian firm acquired a firm in South Korea, overcoming a series of cultural and other barriers. 4. To illustrate a successful acquisition. This case is appropriate for use in the following contexts: 1. In a business policy, corporate strategy or international business course at the graduate, undergraduate or executive level. 2. In the discussion of issues relating to mergers and acquisitions (M&As). 3. In the discussion of issues related to market entry and international expansion. In all of these contexts, the case should be used after students have an understanding of strategy, international business and acquisitions.

Review of the Case:

When compared to Asian Paints, Tata Motors had a tough time initially in acquiring Daewoos commercial vehicle segment. Daewoo had ten companies in their mind, particularly European companies before the acquisition. They did not have a great impression about Tata Motors . They did not have the credentials about Tata Motors. In order to get Daewoos attention, Tata Motors MD Mr. Kant requested the head quarters of Tata groups to have Korean translated version of Tata Motors brochures, pamphlets, along with the film with insights on Tatas credentials legacy, work culture and philosophy to attract Daewoos employees and the share holders. This strategic move of Kant changed Tatas image. Everyone from the governor to the mayor to the trade minister to the union leaders were happy with Tata motors and were eagerly waiting to meet Tatas senior employee. When compared to the previous case, Tata Motors did not have a hard time in taking over Daewoo their credentials were good enough to win over the employees and trade unions in Daewoo.