Mergers
& Acquisitions
Mergers
and acquisitions (M&A) and corporate restructuring
are a big part of the corporate finance world. Every
day, Wall Street investment bankers arrange M&A
transactions, which bring separate companies together to
form larger ones. When they're not creating big
companies from smaller ones, corporate finance deals
do the reverse and break up companies through spinoffs,
carve-outs or tracking stocks.
Not surprisingly, these actions often make the news.
Deals can be worth hundreds of millions, or even billions,
of dollars. They can dictate the fortunes of the companies
involved for years to come. For a CEO, leading an M&A
can represent the highlight of a whole career. And it
is no wonder we hear about so many of these transactions;
they happen all the time. Next time you flip open the
newspaper’s business section, odds are good that
at least one headline will announce some kind of M&A
transaction.
Sure, M&A deals grab headlines, but what does this
all mean to investors? To answer this question, this
tutorial discusses the forces that drive companies to
buy or merge with others, or to split-off or sell parts
of their own businesses. Once you know the different
ways in which these deals are executed, you'll have
a better idea of whether you should cheer or weep when
a company you own buys another company - or is
bought by one. You will also be aware of the tax consequences
for companies and for investors.
At
Penney and Associates, we are committed to providing
the best possible service so your law related needs
are handled with the utmost professionalism.
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