Topics: Joint venture, Mergers and acquisitions, Human resource management Pages: 4 (1180 words) Published: March 7, 2013
Question 1

Cross-border alliances are cooperative agreements between two or more firms from different national backgrounds, which are intended to benefit all partners. A merger is the result of an agreement between two companies to join their operation together. Partners are often equals. An acquisition, on the other hand, occurs when one company buys another company with the interest of controlling the activities of the combined operations. International joint-ventures (IJV) the second type of equity-based in cross-border alliance have experienced tremendous growth during the last two decades. A separate legal organizational entity representing the partial holding of two or more parent firm, in which the headquarters of at least one is located outside the country of operation of the joint ventures. This entity is subject to the joint control of its parent firms, each of which is economically and legally independent of the other. One major reason to engage in mergers or acquisition is often to facilitate the rapid entry into new markets. Mergers and acquisitions are a predominant feature of the international business system as companies attempt to strengthen their market positions and exploit new market opportunities. Some of the factors that a firms takes into consideration when deciding on a target country include the growth aspiration of the acquiring company. Despite the highly yearly growth rates in the area of M&A to be group between the expected added value and the benefits realized from M&A. The IJV can have two or more parent company. Many IJVs however involve two parent companies. This is why they concentrate on this constellation in the following discussion. Problems will get even more complex with more than two partners. The equity division between the parent companies of the joint ventures may differ. IJVs are very similar to those in M&As. In both cases, partners with different institutional, cultural and national backgrounds come...
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