search query: @indexterm OPERATIONAL RESEARCH / total: 1454
reference: 57 / 1454
| Author: | Gupta, D. Gerchak, Y. |
| Title: | Quantifying Operational Synergies in a Merger/Acquisition |
| Journal: | Management Science
2002 : APR, VOL. 48:4, p. 517-533 |
| Index terms: | MERGERS MERGERS OPERATIONAL RESEARCH ANALYTICAL REVIEW |
| Language: | eng |
| Abstract: | Merger and acquisition activity has increased sharply in the last decade. It seems useful to have models that can help senior managers of bidder firms make informed decisions about the amount of premium, over the target's share prices prevailing prior to merger announcement that can be justified on the basis of operational synergies. The goal of this article is to capture important parameters from the production side that have a bearing on the valuation of the target's shares. The authors show that the production characteristics of both the bidder and the target matter in a significant way. For example, if the bidder and target operate in independent markets, the bidder has flexible production facilities but the target's production facilities are inflexible. |
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