Summary
Summary Global Mergers and Joint Ventures
- Course
- Institution
Explains the reasons for global mergers and joint ventures, e.g. spreading risk over different countries or securing resources and supplies
[Show more]
Seller
Follow
emily1744
Reviews received
Content preview
Theme 4 Topic 5Global Mergers and Joint Ventures
Merger – where two firms agree to combine resources and form one company
Joint Venture – where two firms agree to work together on a large project
Reasons for Global Mergers or Joint Ventures
Reason Example
If there was an economic downturn in one country, there
are other countries to fall back on. Tesco has a joint
Spreading Risk Over Different Countries
venture in China with state run China Resources Enterprise
(CRE) which is now the biggest food retail chain in China
The Chinese government does not allow foreign car
Entering New Markets and Trade Blocs companies to manufacture within China unless they are
part of a joint venture with a Chinese car maker
A strong brand or patent can be exploited in various
countries as there is likely to be strong recognition among
consumers and loyalty. This can help the firm move into
Acquiring National and International Brand
new market segments quickly. E.g. L’Oréal transformed
Names or Patents
itself from being a company narrowly focused on white
women to focusing on new markets such as the African
American ethnic market
Operating globally means supply chains can be long and
uncertain. By merging with suppliers, it avoids the
Securing Resources and Supplies
problems of high costs and shortages at certain times. E.g.
Starbucks now own their own coffee farm in Costa Rica
Economies of scale are possible which can enable more
Maintaining or Increasing Global competitive prices e.g. the merger between SAB Miller and
Competitiveness AB Inbev will create the worlds largest brewing companies
with potential for cost saving synergies
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller emily1744. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $3.88. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
67474 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now