Strategy of MTR 
Oxford Brookes University
HKU SPACE
BA (Hons) Human Resource Management
U58029 Organization Behavior
Individual Assignment
Name: Wong Chun
Student ID: 10620264
Hand-in date: 2014, December 15
Introduction: The background of the merger On 8 Jun 2007, the ordinance of merger was passed in the Legislative Council, indicating the entire metro system of Hong Kong was going to integrate and be controlled by only one company. In December, the merger of two corporations, the Mass Transit Railway Corporation(MTR)and the Kowloon–Canton Railway Corporation (KCRC), is completed. The KCR Corporation entitled MTR a service concession to operate the KCR railway system for 50 years (HKSAR government 2006), expanding its market share of Hong Kong public transportation from 25.3% to 41.6% (MTRCL 2007), and sold its properties to the MTR Corporation. According to the official statement of MTR, the purpose of the merger is to improve its capability of risk management and to enhance its business by increasing the efficiency of resource allocation. On the other hand, since both corporations are owned by the government, with the fact that KCR were much less profitable than MTR, there is also a saying that the government precipitated the merger in order to avoid criticism of selling assets of KCR. In fact, if the merger was not controlled by the government, it would be more like an acquisition than a merger, since the properties of KCR and the operation right of its railway system are all taken by the MTR Corporation, while there is no business practice left for the KCR Corporation.
Although successful mergers are said to be infrequent and rare (Weber 2003, Harrison 2007), the merger of these two rail corporations is undoubtedly a triumph. It can be directly seen from the gradually increased profit performance of MTR after the merger (MTRCL 2013).The success can be accounted by both macro and micro level, which are respectively the strategy and the culture of the company.
HKU SPACE
BA (Hons) Human Resource Management
U58029 Organization Behavior
Individual Assignment
Name: Wong Chun
Student ID: 10620264
Hand-in date: 2014, December 15
Introduction: The background of the merger On 8 Jun 2007, the ordinance of merger was passed in the Legislative Council, indicating the entire metro system of Hong Kong was going to integrate and be controlled by only one company. In December, the merger of two corporations, the Mass Transit Railway Corporation(MTR)and the Kowloon–Canton Railway Corporation (KCRC), is completed. The KCR Corporation entitled MTR a service concession to operate the KCR railway system for 50 years (HKSAR government 2006), expanding its market share of Hong Kong public transportation from 25.3% to 41.6% (MTRCL 2007), and sold its properties to the MTR Corporation. According to the official statement of MTR, the purpose of the merger is to improve its capability of risk management and to enhance its business by increasing the efficiency of resource allocation. On the other hand, since both corporations are owned by the government, with the fact that KCR were much less profitable than MTR, there is also a saying that the government precipitated the merger in order to avoid criticism of selling assets of KCR. In fact, if the merger was not controlled by the government, it would be more like an acquisition than a merger, since the properties of KCR and the operation right of its railway system are all taken by the MTR Corporation, while there is no business practice left for the KCR Corporation.
Although successful mergers are said to be infrequent and rare (Weber 2003, Harrison 2007), the merger of these two rail corporations is undoubtedly a triumph. It can be directly seen from the gradually increased profit performance of MTR after the merger (MTRCL 2013).The success can be accounted by both macro and micro level, which are respectively the strategy and the culture of the company.