International Business Analysis

Running head: INTERNATIONAL BUSINESS ANALYSIS
INTERNATIONAL BUSINESS ANALYSIS
Name of the Student
Name of the University
Author Note

INTERNATIONAL BUSINESS ANALYSIS1
Introduction
As discussed by Carvalho and Ogasavara (2017), mergers and acquisitions can be
defined as the process that is based on the ways by which the effective consolidation of the
organizations are achieved with the help of different financial transactions. The process of
mergers and acquisitions also include many other transactions like, purchase of the assets,
tender offers and management acquisitions (Chen, Wang and Young 2015). The process of
merger takes place after the board of directors of the two organizations provide approval to
the combination of different aspects of the companies. The acquisitions on the other hand are
based on the ways by which a particular organization is able to gain the majority stakes of the
acquired organization (Chimenson and Fang 2016).
The essay will be based on the acquisition that was made by the Chinese organization
named Geely Holdings. The organization had acquired Volvo from the US automobile based
giant Ford. The analysis will be mainly related to the ways by which the acquisition has
proved to be effective for the operations of Geely in the automobile industry. The advantage
that has been received by Geely due to the acquisition of a large Western organization will be
the most important part of the analysis.
Discussion based on the acquisition of Volvo by Geely
As discussed by Fang and Chimenson (2017), the Chinese automobile organization
Geely Holding Group was successful in completing the acquisition process of Volvo from the
large automobile giant Ford in the year 2010. This was the first time that a Chinese
organization had gained 100 percent shares of a foreign based rival organization. The
chairman of Geely, Li Shufu had also pledged that the acquisition world be able to play a
major role in the ways by which the Chinese organization can aim at pushing the shares in the

INTERNATIONAL BUSINESS ANALYSIS2
market by keeping to the characteristics that have are a part of its operations (Fang and Wang
2018).
According to Gao (2015), the safety based concerns were considered by the Chairman
of Geely Holdings in order to maintain the sales of the cars of Volvo. The strategy and scope
of the company has been a major factor that was discussed by the Chairman of Geely
Holdings. Geely Holdings had purchased Volvo from Ford at a time the automobile giant had
started facing major issues related to levels of profitability (Lattemann et al. 2017). The
organization had thereby decided to start with divestment of its resources and assets in order
to maintain its position in the automobile industry. The deal had also helped Volvo to recover
from the crisis that had taken place in the automobile industry. The acquisition had led to an
increase in the share value of Geely in the year 2010 by more than 5% (Lebedev et al. 2015).
According to Liu (2019), the acquisition of Volvo was a major step that was taken by
Geely Holdings towards internationalisation of its operations. The acquisition was also able
to lead to high levels of profits and intense levels of technology transfer in the history of
Geely. Many conflicts have taken place based on the merging based operations that have
occurred between the organizations that belong to two entirely different countries (Peng et al.
2017). The major issues that had occurred in the organizations include, the differences that
exist between the leadership styles, resource sharing process and the branding based strategy
as well. The challenges and synergies that have been encountered in the merger based
operations between Volvo and Geely has been a major factor that has affected the levels of
revenues and profitability as well (Ramamurti and Williamson 2019).
The major factors that had been able to play an important part in the acquisition based
operations of the organizations are based on the advantages that were gained by Geely
Holding due to effective acquisition process. Geely had received access to the advanced