Diversifying and Managing Acquisitions Globally Flashcard

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Cross-border M&As:

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have increased in the past 20 years.

Front

Which of the following is TRUE regarding restructuring? The two primary ways of restructuring are downsizing and upsizing., Restructuring (downsizing) is used more often by acquiring firms than by seller firms., Corporate restructuring is the primary tool for reducing firm size and scope., Restructuring is easier in knowledge-intensive firms than capital-intensive firms.

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Corporate restructuring is the primary tool for reducing firm size and scope.

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Among the following synergistic motives for M&As, which is a resource-based consideration? Learning and developing new skills, Overcoming entry barriers, Responding to formal institutional constraints, Reducing risk

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Learning and developing new skills

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When a firm experiences a failure to integrate its M&As after the acquisition, it is most likely the result of:

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poor organizational fit.

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Which of the following statements is TRUE?
- Diversification creates value in virtually all circumstances.
- Diversification can create value by leveraging certain core competencies and capabilities.
- Compared with diversified firms, non-diversified single-business firms are better able to spread risk.
- Firms that undertake acquisitions have mastered the art of post-acquisition integration.

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Diversification can create value by leveraging certain core competencies and capabilities.

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As an organization becomes larger and more complex, adding more employees and using more complicated information systems, what should it expect to happen?

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Bureaucratic costs will go up.

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A company that is engaged in oil production, pipelines and tankers, refining, and gasoline stations has engaged in what type of M&As?

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Vertical

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Research regarding the relationship between product diversification and firm performance indicates that:

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putting your eggs in similar baskets has emerged as a balanced way to both reduce risk and leverage synergy.

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Among the industry-based considerations that motivate a firm to diversify is: power of suppliers and buyers.

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power of suppliers and buyers.

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Which of the following is true of product relatedness? There are agreed-upon methods of measurement of product relatedness., A product-related firm will be considered related regardless of the measure used., Product-unrelated conglomerates are not linked by institutional relatedness., Relatedness is not limited to visible product linkages.

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Relatedness is not limited to visible product linkages.