Mergers & Acquisitions

Mergers & Acquisitions

Introduction

Mergers and acquisitions are the best source of increasing market share, higher profitability ratio, increasing revenues and for creating competitive edge. It is not necessary that these mergers always provide good results to the companies and it happens that the companies bear bankruptcy, liquidity and credit difficulties but if the company has good reputation in the market then government also invests in the company for its bankruptcy bailout.

Sometimes, it happens that these mergers failed due to insufficient planning for the labor cost and companies faced liquidation problem due to recession (Adler, 2010). Companies have to plans for their marketing activities during recession as well. Government has to support companies in their liquidation problem.

In this case, Bankruptcy was faced by General Motors and it was sponsored by Government for its bail out. The case explains that Government has to support their multinational companies as they are contributing towards the strong economy. The General Motor's bailout was also beneficial for the government as it has saved many people from unemployment. General Motor's bail out was one of the biggest sponsored from the government in the US history. This bailout has influenced the employees, suppliers, dealers and the government as well.

Thesis Statement

Bail out from bankruptcy is important for those companies which are the source of employment for the people and providing economic stability to the government.

Discussion

Do you agree or disagree that the taxpayer financed bankruptcy represented the best way to save jobs. Explain your answer?

The assignment discusses that the new General Motors can save the jobs for people as before the bankruptcy, they have provided jobs to millions of people that is why the government has invested in the company to take it out from the bankruptcy. They have saved many people from unemployment. People who have invested money in the company have communicated that General Motors is the fastest growing country and we believe that it can cover its losses by its profits (Houghton, 2013).

People have invested millions of their money in the General Motors so that they can save millions of people's jobs associated with the manufacturing and supplier jobs in the automobile industry.

Governments have to provide such bailout packages to the companies through which they can recover their profits. In this case, government has supported the company in its bankruptcy through bailout and allows the General Motors that they will pay their corporate taxes from their profits and there will be less layoff in the future so that more people can get jobs.

Discuss the relative fairness to the various stakeholders in a bankruptcy, in which a firm emerges from the protection of the bankruptcy court?

A firm that emerges from a bankruptcy protection court as successful is a source of fairness of all kinds for its respective stakeholders. A company of the likes of General Motors has, but various stakeholders. In the light of it getting protection form a bankruptcy court, the shareholders of the company are provided relief. The investments of the respective shareholders are ...