Dear Sir,
Advise how to improve the shareholders' wealth when the company do a Merger and Acquisition of another company in another country. What are the short term wealth benefits and the long term wealth benefits.
Thanks
Anson

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Originally Posted by Anson Soh

Dear Sir,
advise how to improve the shareholders' wealth when the company do a Merger and Acquisition of another company in another country. What are the short term wealth benefits and the long term wealth benefits.
Thanks
Anson

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Not comprehensive, but here are some quick reasons often cited on M&A press releases for a company I provide services for.

1. Tax Haven

2. Exchange rates (example, a lot of great consulting firms go to Canada because they earn US dollars but their goods and services are purchased in Canada, including labor) since exchange rates shift, there are people constantly studying the exchange rate balances. Ultimately this is outsourced by purchasing derivatives and hedge type investments.

3. Lower costs of labor and commodities in foreign shells. I am not a Marxist, but he does point out that labor is a commodity that is bought and sold.

4. Long term global dominance and market share. Imagine if you were first in a booming economy like some parts of China. Even if your market share was 30% and the economy just kept growing, you would still benefit greatly to your top line.

5. Government contract status. Did you hear the one about the defense contractor that went overseas to get US contracts legally?

That's the best I could come up with off the top of my head.

Good luck.