Mergers and Acquisitions: An Integral Part of Business Strategy

Running head: STRATEGIC BUSINESS ANALYSIS
Mergers and Acquisitions
Mergers and acquisitions should be an essential part of a company’s
business strategy
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1STRATEGIC BUSINESS ANALYSIS
As opined by Deng and Yang (2015), the extensive usage of different kinds of
innovative technologies and also the process of globalisation had significantly changed the
nature of the modern business world. Thompson, Strickland and Gamble (2015) are of the
viewpoint that one of the most important trends which is being seen within the framework of
the present business world is the fact that the firms are increasingly resorting to the usage of
the process of foreign expansion in a bid to earn a higher amount of profitability. In this
regard, it needs to be said that one of the most important measures which is being used by the
contemporary firms for entering into the business markets of the different host nations is
merger and acquisitions. The resultant effect of this is that the mergers and acquisitions have
become an integral part of the business strategy used by the different modern firms. This
essay will analyse the manner in which the mergers and acquisitions have become an integral
part of the business strategy used by the different contemporary business firms.
Angwin et al. (2016) are of the viewpoint that the mergers and acquisitions can be
defined as the consolidation of the different business firms or their assets through the usage
of diverse kinds of financial transactions. On the other hand, Uhlenbruck et al. (2017) have
noted that the process of mergers and acquisitions are the one in which the ownership of
business firms or companies or for that matter certain sections of their firms are being
transferred to other firms for the purpose of consolidation or entering into the business market
of other nations. Furthermore, from the legal perspective it can be said that the process of
merger and acquisition is the process of consolidation of two business firms into one with the
inherent objective of enhancing the profitability as well as the prospects of the firms involved
in the process (Tarba et al. 2016). More importantly, the effective usage of the process of
mergers and acquisitions offers the business firms the opportunity to expand the scope of
their business into the business markets of other host nations or for that matter reduce the
scope of their business or downsize.
Lohrke, Frownfelter-Lohrke and Ketchen Jr. (2016) have articulated the viewpoint the
primary purpose of the different business strategies which are being used by the
contemporary business firms is to enable them to take full advantage of the business
opportunities and mitigate the adverse effects of the threats presented by the business market.
More importantly, it is seen that the different business strategies which are being used by the
contemporary firms are intended to enhance their customers, their market prospects, earn a
higher amount of profitability, competitive advantage, sustainability and others (Tarba et al.
2016). However, at the same time it is seen that because of the dynamicity of the modern