Mergers and Acquisitions.
MERGERS AND ACQUISITIONS Introduction The table below outlines merger and acquisitions activity in the UK over the period 1990-2001. The first point of note is the high level of acquisitions during the second half of the 1990s. If we were to go further back, we would find that there was also a boom in acquisitions activity in the second half of the 1980s and during the period from 1968 to 1973. This demonstrates one feature of acquisitions activity: it tends to occur in waves. Acquisitions of UK Companies 1990-2001(Q3) By UK Companies By Non-UK Companies Date No of Acquisitions Cost (£ million) No of Acquisitions Cost (£ million) 990 779 8,329 43 0,958 991 506 0,434 46 6,667 992 432 5,941 210 4,139 993 526 7,063 267 5,187 994 674 8,269 202 5,213 995 505 32,600 31 2,817 996 584 30,742 33 9,513 997 506 26,829 93 5,717 998 635 29,525 252 32,413 999 2000 2001(Q1-Q3) 493 587 313 26,163 06,916 26,724 252 227 14 60,860 64,618 20,188 Office for National Statistics, www.statistics.gov.uk/statbase/mainmenu.asp Another striking feature of the most recent wave of acquisitions has been the large size of individual acquisitions. For instance, in 1989 there were a total of 1505 acquisitions of UK companies costing a total of 39.38 billion. This represents an average cost per acquisition of approximately £26 million.
Risk Analysis on Investment Decision
Risk Analysis on Investment Decision Charles Webb University of Phoenix Risk Analysis on Investment Decision Introduction When deciding on an investment opportunity, one has to consider the risks involved. As an investor or manager makes decisions on which project to invest, consideration must be given for the Net Present Value (NPV) of the different projects from which to choose. Afterward, a good investor should conduct sensitivity and scenario analysis as well as a risk analysis. "Sensitivity analysis shows NPV under varying assumptions, giving managers a better feel for the project's risks" (Ross et al, 2005). In the real world, it is likely that there will be many variables affecting a project. The sensitivity analysis only modifies one variable at a time. This is where the scenario analysis comes into play. "Scenario analysis examines a project's performance under different scenarios (e.g., war breaking out or oil prices skyrocketing)" (Ross et al, 2005). Finally, the break-even analysis helps to calculate the figure at which the project breaks even. This is useful as managers want to know how bad forecasts must be before a project loses money. All three analyses help an organization or individual understand the risks involved in a project. The goal of this paper is to analyze the risks associated with the investment decision made in the Capital Budgeting
Over the years some theories have been said to influence the foreign exchange rates - Discuss each of these theories and critically evaluate their significance.
Part 2 Over the years some theories have been said to influence the foreign exchange rates. Discuss each of these theories and critically evaluate their significance. Foreign exchange rates represent the linkage between one country and its partners in the global economy. The exchange rates affect the relative price of goods being traded (exports and imports), the valuation of assets, and the yield on those assets. In the period of fixed or constant exchange rates these prices, values and yield were predictable over time. But ever since 1973 we have been living in a world where flexible rates have dominated, and the exchange rates aren't any longer predictable. Instead trade flows, interest rate differentials, differing rates of inflation; speculation and other developed theories are determining the exchange rates. In this essay I will examine theories that are believed to influence the exchange rates, and from a critically standpoint hope to see if these theories actually are as influential. However, it should be said that theoretically it has been difficult to differentiate clear, distinctive relations between the theories and the exchange rates since exchange rates are being influenced by several macroeconomic variables. Although interest rates always appear to be incorporated into the exchange rates, the pertain importance of individual macroeconomic variables tend to
Analyse inflation in Germany and the UK
Analyse inflation in Germany and the UK Abstract This project has introduced the hypothesis and given a brief explanation justifying it. The project clearly lays out its objectives to make it clear how I was going to test my hypothesis. The data collection involved searching for relevant prices in order that I could establish rates of inflation so that I could carry out my analysis. The project analysis was undertaken logically following my lecture notes in order that I could establish some coherency and uniformity when presenting my results. The analysis started with me laying out basic graphs in order that I could establish trends. Further analysis involved creating regression slopes and then testing to show to what extent the correlation supported my hypothesis. The conclusions drawn from my project highlight where the project could be improved and in which direction it could be expanded with further research and study. Introduction My hypothesis is that there will be a positive relationship between the inflation rates of Germany and the UK. Inflation is a sustained general rise in prices over time. The rate of inflation measures the percentage increase in prices over time. The reason for this hypothesis is that both economies are open to international trade and active members of the global economy; this means that they both rely on each other for trade causing a
Ethical Decision-Making
Current Trends in Knowledge Management Sharon Robinson DBM 410 Decision Support Systems SPICS1101 University of Phoenix- Clearwater Campus Joe Dobrinski, Jr. May 24, 2005 Workshop #4 Individual Assignment Current Trends in Knowledge Management Current Trends in Knowledge Management There has been a growing realization that investments in information technology have not paid off in performance (Malhotra, 2005a). There has been too much emphasis on treating people as passive recipients of technology and not enough emphasis on individual enterprise. Buying a typewriter does not make one a better writer (BRINT Institute, 2005). Similarly, if a company buys new information technologies, it does not make an organization better at managing knowledge. What is critical is acceptance and effective utilization of the technologies. The key to success is not [just] the system but what people make of it. Knowledge Management (KM) is an evolving discipline that can be affected by new technologies and best practices, but there are some things that we do know for sure (Tobin, 2003). There is a systematic approach to successfully implementing KM and if you analyze what you are trying to accomplish, map out a strategy, garner support from the organization and have a way to measure it, then you are much more likely to be successful. Intellectual Capital Tom Stewart defines
Ethics in accounting
Terri Ronsin has just transferred to a new position as divisional controller. One of her first tasks as divisional controller is to develop the division's predetermined overhead rate for the upcoming year. The predetermined overhead rate is computed by dividing the estimated total manufacturing overhead cost by the estimated total direct-labor hours. The production manager estimates that she will need about 440,000 direct-labor hours to meet the sales projections for the year. Teri develops the predetermined overhead rate and goes to her manager for approval. Harry Irving, the general manager, asks Terri to reduce the estimated total direct labor-hours to 420,000. He explains to Terri that if you shave about 5% off of the estimated total direct labor-hours that there will be an increase in net operating income at the end of the year. If Terri were to lower the estimated total direct labor-hours, the predetermined overhead rate will be higher, resulting in overapplied overhead. In this situation the overapplied overhead would be closed out to Cost of Goods Sold. This would be done by debiting Cost of Goods Sold and crediting Manufacturing Overhead resulting in a decrease in Cost of Goods Sold. At the end of the year, Cost of Goods Sold and operating expenses are subtracted from sales. The result of this is the net operating income. Therefore, if the Cost of Goods
Project management
Project Evaluation Selection of the right projects is crucial for long-term survival of the company. Choosing the wrong project does not just mean that the project will be doomed, but it may have a detrimental effect on the immediate future of the company. The development of the "RB111 carbon fibre turbine blade" project by Rolls Royce is one of the well-known cases. The aim of project evaluation is to facilitate choice amongst alternative projects under consideration. Data, which is relevant to projects, is organized and aggregated into a summary that reflects the relative strengths and weaknesses of each project. The projects are then ranked according to the pre-determined criteria and the one which best satisfies the objectives of the company is selected. Selection Criteria The criteria by which the merits of the alternatives are assessed depend on the project and the company's objectives. Some of the most commonly used criteria and its relative importance are shown in the diagram below. As shown in the above diagram, public projects and private projects are often evaluated using a different set of priorities. Different industries may also assign different priorities to the same set of criteria. Even within a project evaluation team, different members can assign different priorities to the same set of criteria. This explains why project evaluation team members often
What are Dividends?
Dividends are payments made to stockholders from a firm's earnings, whether those earnings were generated in the current period or in previous periods. When dividends are paid, shareholders in many countries, including the United States, suffer from stock buyback, in which the company buys back stock, thereby increasing the value of the stock left outstanding. While it may be true that in the stock market there is no rule without an exception, there are some principles which are tough to dispute. We'll review 10 general principles to help investors get a better grasp of how to approach the market from a long-term view. Keep in mind that these guidelines are quite general, each with different applications depending on the circumstance. But every point embodies some fundamental concept every investor should know. The primary purpose of any business is to create profit for its owners, and the dividend is the most important way the business fulfills this mission. When a company earns a profit, some of this money is typically reinvested in the business and called retained earnings, and some of it can be paid to its shareholders as a dividend. Paying dividends reduces the amount of cash available to the business, but the distribution of profit to the owners is, after all, the purpose of the business. ) Sell the losers and let the winners ride! - Time and time again, investors
value chain
http://www.marketingteacher.com/Lessons/lesson_value_chain.htm http://www.ukeducation.org.uk/Documentation.asp?key=1340 http://www.12manage.com/methods_porter_value_chain.html http://tutor2u.net/business/strategy/value_chain_analysis.htm www.andrew.cmu.edu/course/70-381/chap18.ppt Answer to d Value chain analysis Porter developed the value chain analysis to realize operational activities which is closely connected with the activities of cost behaviour. Value chain defined as integrated series of organisation, resources, and information involved in production to deliver a value to customers at end . Generally it explain the whole process of a product or service from being conceptualization, supply it to consumers and disposal after final use .A firm or an organization who operates value chain efficiently also cost effectively than it rivals gain competitive advantage. Primary and secondary stages are involved in value chain analysis. Inbound logistic In this activities relationship are created with supplier by receiving goods, storing them till they are required for production or supply, and performing inventory in due time.. Transportation of goods is performed under this activities. For example product are stored in warehouse and often transported to retailer by manufacturer. Operation operation activities comes in function after Inbound logistic. which mostly