Merger and Acquisition in Banking Industry

Abstract

Mergers and acquisitions (M&A) represent significant strategic maneuvers in corporate finance and management, involving the combination, acquisition, or division of companies to achieve various objectives. This paper explores the fundamental concepts of M&A, focusing on mergers as agreements uniting two companies into one entity. Mergers are pursued to expand reach, enter new markets, diversify offerings, or gain market share, ultimately aimed at creating shareholder value. Two primary types of mergers are discussed: conglomerate mergers, which involve companies in unrelated business activities, and congeneric mergers, where companies operate in the same sector with overlapping factors. Understanding the nuances of these mergers is essential for stakeholders involved in corporate decision-making. Additionally, regulatory frameworks, such as the Companies Act, 1856, play a crucial role in governing M&A transactions, although regulatory landscapes may vary across jurisdictions. By delving into the intricacies of M&A, this paper provides insights into strategic management practices and the dynamic landscape of corporate restructuring.