Synergy Realization in Mergers and Acquisitions

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Strategic Analysis
Name
Institution
1. What would the corporate parents need to do to ensure the realization of the sorts of
synergies described above?
Synergy refers to the act of two companies combining to operate as one with greater strength and
performance than before (Garzella, &Fiorentino, 2014 pg 1200).Many companies cite synergy as
one of the justifications for unions and achievements. To ensure the realization of the synergy of
premedia and about, thecorporate parent need to ensure that the company meets the following;
Improved market reach-Merging the two companies will bring forth large market coverage.
Premedia being the leading traditional company and About.com being the leading online
company, when merged will put together their targeted population as a single company.
Savings from reduction of people-Reducing the number of employees in the company would
encourage saving. When each company worked individually, it hired quite big number of
employees compared to now. The salary paid to the employees can be saved to the company
after merging. (Antila, Popova,Akamine,Sullivan, & Hen, 2011). Company is an online site and
the premedia also has some websites whichcanbehandled together.
Acquisition of new talent and technology-Premedia combined with About, should put their
talents and technology in a pool and share their knowledge in improving the productivity of the

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company (Kopecka,Rozkova, &Sediva, 2013 pg 291). This enhances the growth of the company
and outdoes their competitors.
Enhanced visibility of a company is acquired through merging of the companies. A bigger
company tents to be well known than a small company. When it is well known, it means that
productivity increases since there are many willing customers. Revenue would be generated-
premedia planned to take advantage of cross marketing and shared content with the new merger.
It would cut back its expenses by doing its internet business with About account.
Standardized management practices-The two companies would work smoothly by putting
together their strengths and eliminating the weaknesses. This helps creating opportunities to
expand sales in the new and existing market. The breadth of experience-the longer period of time
a company has served a particular market the more experienced they are. This experience
enables them to strive for success in their business.Both premedia and about have enough
experience to meet competitors in the new market.
2. What might prevent the realization of those synergies?
On the other hand, realization of synergies may be prevented. First, high employee resistance
can prevent realization of synergies. When the company managers introduce ideas or process to
be put into practice for the benefit of the company, then a big number of the employees resist
claiming that it is cumbersome (Micklavzina, &Stovall, Sprint Communications, 2010, Np). This
negative reaction can bring lack of unity and cooperation in the working area hence failure to
realize any improvement. Secondly, the way of communication in any business is very
important.In the case of a company a certain hierarchy is followed. When information is
communicated in the wrong way and time it would bring a negative impact to the company. For