Assignment on Corporate Finance Essay Example | Topics and Well Written Essays - 3500 words

Assignment on Corporate Finance - Essay ExampleA merger can resemble a takeover but result in a new company name or combining the names of the original companies. (http//en.wikipedia.org)Shleifer and vishny (2003) proposed a market timing archetype of acquisition. They assumed that acquirers are overvalued, and the motive for acquisition is not to gain synergies, but to reserve some of their temporary overvaluation for long-run shareholder. Specifically, by acquiring less-overvalued object with over wrongd stock (or less interestingly, undervalued target with cash) overvalued acquirers can cushion the fall for their shareholders by leaving them with more hard assets per share or, if the deals value proposition.This refers to the fact that the combine company can often reduce duplicate departments or operations, lowering the cost of the company relative to theoretically the same revenue stream thus, increase profit.For example, a bank buying a stock broker could then sell its bank ing products to the stocks customers while the broker can sign up the banks customers for brokerage account. Or a manufacturer can acquire and sell complimentary products.This is the sign to smoothen the earning result of a company, which over the long-term smoothes a stock price of a company, giving conservative investors more confidence in investing in the company. However, this does not always deliver value to shareholders (http//en.wikipedia.org) From datamonitor analyses, UCB has an inorganic expansion into stipendiary AIID and oncology market. The acquisition of the Biotechnology Company, Celltech offered UCB technology platforms and experience for the development of biological drugs.And the new regulations allows our company to create motive for us to merge and acquire, which is an opportunity for us to swallow a strong R & D pipeline and new expertise in the pharmaceutical sectors. So all of this would be achieved rapidly if acquisition finding is taken.Asset acquisition UCB is a multinational company, operating in more than one hundred and forty countries, also it is one of the largest pharmaceutical and chemical