Contents

• Introduction 3
• Background of the Merged Companies 4
• AB InBev Acquiring SABMiller 5
• The Internal and External Impacts of the Merger 7
• Synergies 7
• Stress and Culture 8
• Shareholder Value 10
• Bargaining Power of Buyers and Suppliers 11
• Rivalries among Competitors 12
• Financial Analysis 15
• Conclusion 17
• Works Cited 19

Description

In the 21st century contemporary world, there has been a lot of developments and progress in the context of business. Beginning from the home countries, almost every large organization of the business sector tends to expand their business across the globe with the implementation of various innovations or suitable business strategies enhancing their growth. The owners of the businesses are always looking forward towards making more money or serving a bigger customer base. So, it is utterly important for the executives of the respective companies to adopt the best possible method for growing the business at a quicker pace after analyzing the market scenario (InCorp Global, 2016). One of the most identified and widespread technique of expansion is that of merger and acquisition, which most of the major organizations take into consideration while entering new markets. Along with associated benefits of growth and expansion and global market entry, this method is advantageous as it reduces competition, increases revenue and possible synergy of the business involved in this procedure (InCorp Global, 2016).
Merger and acquisition is categorized as a procedure leading to the inorganic growth of a business. The combined values of both the businesses would provide with a stronger credit line. This process provides with new distribution channels resulting into accelerated augmentation (Johnston, 2011). Although it is often considered as a shortcut to growth, it is an exclusive method set aside for larger organizations (Business Matters, 2015). The organizations can bring growth of revenue through mergers and acquisition or economize business through divestment (Kling, Ghobadian, & O'Regan, 2009). Likewise, the two major companies which are the AB InBev and the SABMiller have undergone the process of mergers and acquisitions where the former has acquired the latter. It was a long awaited merger which involved more than $ 100 billion and is considered by the Financial Times as the third largest and significant acquisition in the times past and the biggest ever in the land of Britain (Nurin, 2016).