20th Century Genius Award Essay

A nominee for the 20th Century Genius Award should be Riley B. King. King has had an integral part in the history of the blues style of music since the mid 1950s. The manner in which he plays his guitar, Lucille, and his voice are very distinguishable. His style of instrumentation has carried over to other genres of music as well. He is hail as the reigning king of the blues. Most blues guitar solos will have some of the recognizable King inspired bent notes. Riley B. King, better known as B. B. King, was born September 16, 1925 to a family of poor sharecroppers in Mississippi. King’s artistic contribution to the 20th century is music, most notably the Blues. In the blues arena, he is probably one of the greatest and most respected guitarists in the history of the genre. When one hears the name B. B. King, the music of the blues immediately comes to mind. His musical motivation came from the music in his church. At first, Riley wanted to become a gospel singer. The pastor in his church taught him the basics of guitar. He then became a self taught guitarist by using instruction books he ordered through the mail. Since his arrival on the scene in the mid 1940s, King has been the definition of blues for the world wide audience. In his youth, he would play his guitar on street corners for dimes. There were nights when he would play in four towns. Riley also performed with small gospel groups. At the age of 21 hitchhiked from his home in Mississippi to Memphis to pursue his dreams in music. In 1948 King’s performance on a radio station in West Memphis launched his career. This performance turned in to regular performances at a grill in West Memphis called Sixteenth Avenue Grill and to a 10 minute time slot called â€Å"King’s Spot† on a radio station in Memphis. King’s 10 minute show was such a hit, the show was lengthened and turned in to a show called â€Å"Sepia Swing Club. † Riley decided he should have a name that was easily remembered for his radio show, so he started out with Beale Street Blues Boy. That named seemed to be too long, so he shortened it to Blues Boy King. When Blues Boy King first performed in New York, he decided to shorten his stage name to B. B. King. King has named his guitars â€Å"Lucille† after he performed at an event in Twist, AR. A couple of men began to brawl over a woman and during the brawl a stove that was fueled by kerosene was knocked over. This set fire to the building and everyone rushed out. When King realized his guitar was still inside, he risked his life to run back inside and retrieve it. After it was all said and done, he found out the two men were fighting over a lady by the name of Lucille. At that time he figured he would give the name â€Å"Lucille† to his guitars so he would remember to in no way do a foolish thing like fighting over a woman. In King’s song, â€Å"Three O’clock Blues (1951), the song begins with a four bar guitar introduction, followed by four full choruses of the twelve bar form. The third chorus is an instrumental with the guitar improvising on the harmonic progression. In this song, King sings and then plays guitar lines that serve as a response to his vocal lines. The guitar lines reproduce and expand on the vocal melody to which they answer and often use string bends to reach blue notes. An accompaniment is provided by saxophones playing notes that are long held. The drums are very quite with little or not accenting of the backbeat. Some urban sophistication in the arrangement is the occasional use of half step slides into some of the main chords of the progression. A great deal of the time, King slides down to the appropriate chord, then turns around and slides up to the tonic chord at the final beat. During his career, King has created one of the most individualistic guitar techniques in the world. He integrated his specific and intricate vocal-like string blends and his left hand vibrato. These types of instrumentation have turn out to be important works of a rock guitarist’s expression. B. B. King was inducted into the Blues Foundation Hall of Fame in 1984 and into the Rock and Roll Hall of Fame in 1987. He received the National Academy of Recording Arts and Sciences (NARAS) Lifetime Achievement Grammy Award in 1987 and has received honorary doctorates from several universities. According to Billboard, â€Å"B. B. King has 74 entries on the Rhythm and Blues charts and he was one of the few full fledged blues artists to score a major pop hit when â€Å"The Thrill Is Gone† crossed over to the mainstream success. † King’s lyrical and expressive solo style has made a large impact on several artists in the rock genre such as Eric Clapton, George Harrison, Jeff Beck, Jimmy Page, and Jimi Hendrix, Mike Bloomfield. B. B. King’s urban blues guitar style includes the playing of lines that are equal in importance to the lines he sings. There is no single recording that can show the brilliantness of B. B. King’s abilities as a guitarist or a singer. His interest in playing melodic lines rather than chordal accompaniments is quite obvious in several of his numbers. King has performed as a featured soloist with jazz bands and groups of all sizes. He has also performed with large orchestral string sections playing arrangements of blues songs. Considering what B. B. King has done for the art of blues music, the accomplishments he has had during his career, and the influence he has had on the various genres of music, his contributions to the blues music will continue to impact the music industries for years to come. For these reasons, B. B. Kind should be considered for nomination for the 20th Century Genius Award. References (April 03, 2008). B. B. King. Retrieved April 10, 2008, from Academy of Achievement Web site:  http://www.achievement.org/

BASF Case

When we speak on BASF’s efforts to restrict stakeholder pressure, the stakeholders, whom we are referring to, are the town’s commission and its populace. The two primary efforts which BASF has made to resist their pressure are: assuaging their fears and subverting their demands.Now, BASF attempted to their assuage fears by claiming no third party waste would be brought to this new waste facility. They also claimed that all waste, whether toxic or non-toxic, would be incinerated and, thus, should pose no threat to the townspeople.Additionally, BASF released two printed volumes which detailed how the waste would be incinerated. And, repeatedly, the company assured the public that building the new plant would create jobs and be perfectly safe for the community. They proclaimed that there would be no harmful effect on the environment now, nor at any time in the future. On the subversion end, BASF used many techniques. They cajoled the county commission into selling the prop erty without requiring appropriate background data and environmental information.Also, they altered their proposal after submitting it to the town council, and the data which they released was highly suspect according to a local professor. They also used high powered lawyers in efforts to push through the land’s sale and to obtain the appropriate environmental certification. This certification would allow the plant’s development to proceed. All of these tactics were a subversion of the local townspeople’s trust and wishes. However, these have been relatively affective measures in resisting stakeholder pressure, and, likely, the plant will be built.

Medtronic External and Internal Analysis Essay

Medtronic Inc. can easily be compared to le Concorde, a turbojet supersonic passenger airliner first flown in 1976. This jet was more than twice as fast as any other airliner ever created, flying at speeds of up to 1,350 mph. The capability to fly at more than twice the speed of a regular airliner equates to twice the flights and premium prices for this astonishing service. The resulting profitability of le Concorde is what puts this machine at the top of its class. In 1957, Medtronic founder Earl Bakken created Medtronic’s Pacemaker, the first wearable device to treat abnormally slow heart rates. The Pacemaker is now the staple product of Medtronic and can be compared to le Concorde for its innovation, efficacy, and profitability. This is just one example of Medtronic’s ability to use its innovation to transform the treatment of chronic disease worldwide. The firm has been a leader in the Medical Device Manufacturing industry for over two decades, developing and manufacturing innovative medical devices to treat more than seven million patients each year. Its products include pacemakers, defibrillators, heart valves, and stents, among others. Medtronic’s drive for excellence is best summed up by its corporate mission, â€Å"To contribute to human welfare by application of biomedical engineering in the research, design, manufacture, and sale of instruments or appliances that alleviate pain, restore health, and extend life† (Medtronic. com). To achieve its goals and maintain success, Medtronic must constantly monitor and evaluate its external environment and the forces in it that could affect the company. The Medical Device Manufacturing industry is exposed to numerous forces and trends that can generate opportunities for firms to exploit as well as threats for firms to avoid. Of note are the effects of rivalry, buyers, regulation, and globalization trends. The Medical Device Manufacturing industry, as a whole, has grown at an annual rate of 18. 9% since 2005, contributing to a high level of industry attractiveness (ibisworld. com). Medtronic is the clear leader with 17. 2% market share. Its closest rivals, Boston Scientific and St. Jude Medical, have market shares of 2. 8% and 4. 8%, respectively (ibisworld. com). Recently, the industry has seen a dramatic increase in consolidation as larger firms have cquired smaller operations in an effort to diversify their portfolios and gain market share. This shrinkage has resulted in greater industry concentration, increasing the rivalry among these key players. Focusing on a more narrow analysis of the Cardiovascular Device segment reveals a similar, more intensified, environment for rivals. Compared to the overall industry, this specific segment has recently witnessed much lower growth rates because the market is saturated with products that have little differentiation and limited innovation possibilities. For this reason, merger & acquisition activity is especially prominent among top firms seeking to create strategic competitiveness. They have identified the threat of rivals and are looking to gain additional resources and capabilities through diversification. The role of buyers is very unique in this industry. While individual patients are the ultimate consumers of medical devices, firms often focus on healthcare providers when selling products. This is because patients in the market have low brand recognition of the devices they use. Instead, they rely on their hospitals and physicians to recommend products for treatment. It is important for manufacturers to understand this distinction since it is these physicians and other providers that have the greatest brand loyalty. That said, individual patients still drive demand for products, and their satisfaction remains the ultimate goal. One key demographic trend of buyers is the aging U. S. population. As life expectancies continue to rise, and the baby boomer generation ages into their late sixties and seventies, this expanding age group will create a great opportunity for medical device manufacturers. For example, elderly patients experience a higher occurrence of health issues compared to the aggregate market, driving demand for medical devices upward. In fact, 40% of all patients diagnosed with heart disease or arthritis are 65 or older (ibisworld. com). The Medical Device Manufacturing industry is also subject to tight regulations, both domestically and internationally. For example, a new device may require a four-year trial before it appears on the market so that the Food and Drug Administration (FDA) can test its long-term effects. Products in Europe, meanwhile, undergo a different regulatory process; products are often introduced in Europe two to four years before they are available for patients in the U. S. Furthermore, compliance with these regulations requires firms to devote significant additional resources, often detracting from investments such as Research and Development. Along with these initial requirements, devices are constantly monitored for defects, which can result in product recalls that damage brand reputation and hurt profits. Globalization trends will certainly continue to have a strong impact on the industry, creating both opportunities and threats. Research shows that exports account for 21. 6% of industry revenue with an expected 2010 growth rate of 3. 9% (ibisworld. com). By developing these export markets, firms can work to maximize capacity utilization as they expand their distribution channels to reach more customers and generate more revenue. This is especially true of developing economies, in which 80% of chronic-disease-related deaths occur. Large portions of these markets are greatly underserved and demand is not being met. In addition, by diversifying into different geographic markets abroad, firms are able to mitigate the risks associated with being too dependent on the domestic market. The emergence of globalization also introduces several threats that firms must be aware of. For one, the competitive landscape changes as companies establish operations sites in foreign countries. When this happens, the demand in export markets declines since customers can purchase devices locally. Exporting firms must then reevaluate their international strategies and consider establishing similar operations of their own. Another threat globalization brings is that of increased competition. Manufacturers constantly fight to expand their geographic reach and to gain control of underserved markets. Given the effects of strong forces and emerging trends in the Medical Device Manufacturing industry, firms should strive to possess a key group of success factors in order to gain strategic competitiveness. The first factor is employees; they must be highly skilled and knowledgeable since the devices they design and produce are very complex. Second, economies of scale allow firms to improve profitability by reducing variable costs in manufacturing, which, in turn, lowers prices for customers. Third, as previously mentioned, the importance of global positioning cannot be understated. In order to compete in the industry, firms must make a global presence, expanding geographic scope and penetrating underserved markets. Finally, access to the latest innovations is imperative. To acquire new technologies, firms must invest considerable resources into Research and Development. Not only must they develop new technologies, but they must also look for ways to continuously improve existing products through high levels of innovation. This understanding of the industry environment is essential when considering a firm’s internal strategies. At the business-level, Medtronic possesses a number of strengths and competencies that are used to create a competitive advantage and contribute to the overall performance of the company. In particular, its research and development efforts along with its superior human resources drive the firm’s differentiation strategy in the Cardiac Rhythm Disease Management (CRDM) unit (see appendix for more strengths). This sector remains the firm’s most profitable product market, accounting for $5. 268 billion of Medtronic’s $15. 817 billion total net sales in 2010 (Medtronic). As a percentage of those sales, Research and Development expenses equated to 9. 23%, a total of $1. 46 billion. Moreover, this expense has seen a Compound Annual Growth Rate of 8. % in the last 5 years, indicating Medtronic’s continued confidence in its ability to create value through the investment in research and development. The innovation fostered by research and development in CRDM has allowed Medtronic to create many new products; the complex nature of these products makes them rare and costly to imitate. They often even trump and replace the existing technology in the mar ket, making them highly valuable and unsubstitutable. These key innovations, therefore, give Medtronic a significant competitive advantage in research and development. For example, the CRDM unit recently introduced a new leadless pacemaker. Once implanted into the heart via catheter, the penny-sized device permanently latches into the flesh with tiny claws. Doctors can then wirelessly monitor and control the pacemaker. Medtronic’s demonstration of reduced size and wire elimination will create a new standard for such devices in the industry, making current, bulky pacemakers obsolete, and giving Medtronic a sustainable competitive advantage. Medtronic’s 40,000 employees also play a key role in the success of CRDM and of the company as a whole. They are the source of one of Medtronic’s most valuable intangible assets: knowledge. With a thorough understanding of human physiology and a breadth of technical skills, employees are a driving force behind the company’s groundbreaking innovations. They generate ideas and implement processes that create new or improved products or therapies. These advancements require that employees are well trained and possess a high degree of knowledge about the products or therapies they develop. In addition to the actual production of products, employees extend their knowledge to customers. By educating healthcare providers and users about the devices, employees ensure that patients safely receive the full benefits of Medtronic’s products. One way Medtronic optimizes its human resources is through collaboration blogs and internal grants. The company’s Quest program awards project grants that encourage employees to test their own ideas for product innovation. Nearly 25% of these projects eventually become a product or some part of a therapy. For example, employee Brain Lee had an idea to create an effective diagnostic tool for patients who suffered from unexplained fainting. With funding from the Quest program, Lee modified a pacemaker by adding self-contained electrodes. The device could be implanted just below the skin, recording electrocardiogram (ECG) signals in an endless loop. Much more effective than existing external tools, Lee’s device received additional funding, leading to successful clinical trials, and, eventually, a commercial release. This is just one example of how Medtronic’s strong workforce creates a core competency for the firm, one that is unmatched by its rivals. Furthermore, the innovations developed by employees and through research and development efforts can often be protected with patents, generating competencies that are not only distinctive, but also sustainable. At the corporate level, Medtronic is very well positioned. The firm outperforms its rivals in terms of market share with 17. 2%, compared to Boston Scientific and St. Jude Medical, which hold 2. 8% and 4. 8% market share, respectively. Since 2007, Medtronic has experienced an 8. 75% compound annual growth rate. While lower than St. Jude’s growth rate of 12. 3% in the period, it is noticeably higher than that of Boston Scientific’s, 6. 84% (See appendix for further financial comparisons). Medtronic’s corporate-level strategy defines which businesses it will be in as well as how it will integrate those businesses to grow and deliver value to stakeholders. The firm currently operates in seven business units: CRDM, Spinal, CardioVascular, Neuromodulation, Diab etes, Surgical Technologies, and Physio-Control, all of which are largely related. Because of Medtronic’s strong war chest, it has been able to focus its growth strategy around acquisitions. Since 2009, the firm has purchased nine companies, including ATS Medical Inc. and CoreValv Inc. , requiring a significant cash investment. In fact, Medtronic spent $370 million when it bought heart valve maker ATS Medical. The firm’s acquisition strategy specifically targets two types of purchases: those that will add immediate revenue to existing businesses, and those that add to Medtronic’s technology portfolio by providing expertise the company does not have. Of late, the firm has been focusing on the former, targeting smaller companies that lack the resources to complete clinical trials and gain FDA approval. Chad Cornell, vice president of corporate development at Medtronic, notes, â€Å"Size is obviously a factor, but it’s not what we start with. † Instead the question is â€Å"how can we add value? That’s the key lens† (Lee). Medtronic’s international strategy is best characterized as a global strategy whereby it develops devices in the United States to be distributed across country markets. To support this strategy, it uses a worldwide product divisional structure. Medtronic has recently changed its strategy, implementing a Global Realignment Initiative in 2008. The goal of the initiative is to reorganize the firm’s resources to focus on areas that add the most value and have the most attractive growth opportunities. Prior to 2008, the company had segmented its global market into the United States market and international markets. Under this new strategy, Medtronic will focus around developed markets and emerging markets, using its resources and capabilities to effectively meet each segment’s unique needs. Developed markets include regions such as the United States and Europe where trained healthcare professionals are familiar with current devices, and new, innovative products are readily accepted. Medtronic relies on its strong innovation capabilities and Research and Development investments to meet the demands of this segment. For example, patients with pacemakers are often denied potentially life-saving MRI scans due to possible pacing interference. Medtronic used its superior innovation and product knowledge to address the concern, manufacturing the world’s first pacemaker that is compatible and safe to use with MRI systems. Introduced in Europe in 2008, this innovative device provides a much-needed solution to millions of people who will now be able to receive the full benefit of a safe MRI scan. Emerging markets, meanwhile, include regions such as China, Brazil, Africa, and the Middle East, where access to care is often limited, and physicians may be unfamiliar with certain medical devices and hesitant to accept new products. In this segment, Medtronic depends on its employees and its reliable, high-quality products. Using these strengths, it focuses on training and educating healthcare providers so that products and treatment are much more accessible to underserved patients. At present, Medtronic operates in more than 120 countries, with more than 16,000 employees in communities outside the United States (Medtronic. om). These employees provide immense value to the company by using their extensive knowledge and skills to educate and collaborate with physicians around the world. Currently, 41% of total revenues are realized outside of the United. Medtronic plans to continue its geographic diversity strategy, aiming to become a â€Å"truly boundaryless organization† an d maintain its commitment to â€Å"making a sustained, global impact in the fight against chronic disease† (Medtronic). In order to keep its world-class status, Medtronic executes various tactics at each of its organizational levels in order to protect its strategic competitiveness. For example, the company uses a frontal assault on its biggest competitor, Boston Scientific. By using revenues created from CRDM, they have the capability to invest large investments into research and development in ways that Boston Scientific cannot. In doing so, they maintain continuous development and improvement of innovative products. Another tactic that Medtronic uses is the pre-emptive strike, identifying and evaluating a valuable opportunity and seizing it before a rival does so. This increases sales, differentiates Medtronic from competitors such as Boston Scientific, and helps foster innovation. Based on the analysis of Medtronic’s external environment and internal strategies, it is clear that the firm is a leader in the Medical Device Manufacturing Industry. However, there are also some key problems and issues the firm should address. Medtronic has had litigation issues over the past few years with recalls in various different product offerings as well as patent and licensing disputes. As noted on the 2010 annual report their litigation charges amounted to nets of, $374 million in 2010, $714 million in 2009, and $366 million in 2008 (36-37). This has been an industry wide issue as seen by Boston Scientifics 2009 litigations charges amounting to $2. 022 billion, $334 million in 2008 and $365 million in 2007 (Boston Scientific Annual Report pg. 69). With these industry wide litigation issues, the FDA is currently creating new standard procedures for testing products and time required to introduce them into the market, which creates a separate challenge in dealing with the new health care reform. In a recent interview with Brian Johnson from Massdevice. om, the CEO of Medtronic, Bill Hawkins outlines the challenges ahead with the new health care reform. â€Å"The new medical device tax will cost us $150 to $200 million per year when introduced in 2013. In 2010 we spent $1. 5 billion on R&D and this tax will directly affect that budget for us which hurts our innovation, or possibly investments in emerging markets†. Cleary the health care reform will be one of the toughest challenges ahead for Medtronic and the rest of the medical device industry.

Phonemic awareness and it's relationship to word analysis Research Paper

Phonemic awareness and it's relationship to word analysis - Research Paper Example Phonemic awareness can be considered as a subset of the phonological awareness in where listeners possess the ability to hear, and identify and the manipulate phonemes, smallest units of sound which may differentiate meaning, is Separating, spoken word " the cat" through into three separate phonemes, /?/, /k/, and /t/, requiring the phonemic awareness. National Reading Panel (NRP) had realized several years ago that the phonemic awareness may and do elates an individual’s word reading and comprehension in reading, in addition to assisting people learn to know how to spell. According to a research conducted by the University of Nairobi Phonemic awareness can safely be considered as the basis for learning the phonics. Phonemic Awareness And Phonological Awareness Phonology awareness and Phonemic awareness, more often than not are confused as most of the circumstances they are considered interdependent. Phonemic awareness capability to manipulate and hear individual phonemes. On the other hand Phonological awareness do include this capacity, in conjunction to the ability to hear and then manipulate much larger units of an individual’s sound, these includes the rimes, onsets and syllables. Several Studies by the Vickie Snider have indicated openly that the phonemic awareness possess a more than direct correlation with its students’ capability to read as they tend to get older. In fact it is claimed that Phonemic awareness do build a very strong foundation from which the students to do understand rules of English language. This as a result allows respective student to put in practice the skills and thereby increasing the student’s oral reading eloquence and in understanding of the text. Phonemic Awareness Skills Practiced With Students The above subject matter relates to the capability to differentiate and handle individual sounds, like /?/, /f/, and /t/ just as for instance in pronunciation the foot. Below are some of the general phonemi c awareness skills practiced with students: Phoneme isolation: that necessitates recognizing individual sounds in the respective words, instance, "update me the initial sound heard â€Å"paste" (/p/). Phoneme identity: that requires distinguishing common sound in dissimilar words, for instance, "update me the sound which is similar in boy, bike and bell (/b/). Phoneme substitution: where an individual has the ability to turn words like â€Å"cat† to another like "hat" just by replacing a single phoneme †/h.† for another /k/. The Phoneme substitution may and do take place for initial sounds as in the (cat-hat), the middle sounds such as the (cat-cut) or the ending sounds as in the (cat- can). Oral segmenting: A teacher may say a word like, "ball," then the students go ahead to say the respective sounds, as in /b/, /?/, and /l/. Oral blending: Teacher may say each individual sounds, as in, /b/, /?/, /l/ then the students respond by saying the word, "ball." Sound de letion: Tutor says one word, for instances, "bill," then the students repeat it, he/ she then instructs the students to replicate or repeat the word in the absence of a sound. Onset-rime manipulation: That necessitates identification, isolation, segmentation, deletion blending, of onsets â€Å"single consonant or blend which leads the vowel and behind consonants, for instance, st-op, j-ump, str-ong. For

Alienation from Species-being Term Paper Example | Topics and Well Written Essays - 250 words

Alienation from Species-being - Term Paper Example He revealed that past human actions resulted in today’s independent and natural society (M Josephson, 1968). He also showed that the human actions are also responsible for shaping tension free future. According to him alienation is not embedded in the religion and minds instead it is embedded in this materialistic world. To him alienation means loss of control especially over labour. Like all other creatures, Humans need to work for their survival in this world. Marx gave us four elements of alienation and species being is one of that. Labour produces poverty for workers but it is miracle for rich people. The capitalism has submerged the ability to work collectively and created the class division. For gaining profit we are deliberately destroying our nature for example the cheapest techniques of production results in acid rain which is harmful for ozone layer. In the same way when capitalist increases his production to gain profit he is unconsciously lowering the rate of profi t for his class. In this race the production is more than demanded and as a result the workers were in loss. The product is owned by capitalist that’s why workers are alienated from the product they manufactured (H Braverman, 1974).

Personalized Medicine and Biomarkers (Biomedical Informatics) Research Paper

Personalized Medicine and Biomarkers (Biomedical Informatics) - Research Paper Example Biomedical informatics and health informatics is an interdisciplinary field which integrates different fields such as computer science, biology, medicine and health care. It fosters an effective analysis and management of data for its application in health care. Bernstam et al , [1] defines biomedical informatics as a science of information where data is presented together with meaning in finding solutions to biomedical related problems. This makes the field distinct from related fields such as biomedicine, bioinformatics and computer science. Computers provide the interface between the data which they process and humans interpret the meaning of the data, a task the computers are incapable of carrying out appropriately. This field has gained relevance because of the rise in use of electronic health records and the plethora of data emanating from genomics research, [2]. Because of the growth of the data available to professionals in the healthcare, there has been a change in the patte rn of medical decision making towards the requirement of informatics and information technology platform to assist medics in their decision making. Personalized medicine is a form of medicine that makes use of personal information derived from person’s genes, proteins and environment to assist in disease prevention, diagnosis and treatment, [3]. A biomarker is a variable which can be a gene, protein, or chemical which is altered in disease condition. Biomarkers are classified as prognostic, predictive or therapeutic biomarkers. Prognostic biomarkers try to assess the likely cause of a disease whereas predictive ones assess the probability of whether a patient will benefit from a particular therapy. In the recent times, personalized medicine has been ameliorated by a more improved molecular understanding of disease thereby introducing effective

Importent Essay Example | Topics and Well Written Essays - 250 words

Importent - Essay Example To analysis how different models changes with ICT, Andriole (2015) assessed various models. When there is improved governance expansion of ICT stakeholders, there is a likelihood of increasing the importance of technology. Such steps improve governance, how business operates, how strategies are implemented, and guides the emergence of related technologies. For instance, the emergence of participatory governance correlates positively with the adoption of technology in federal and business environments. Besides, there is increased satisfaction of business requirement if cloud-computing takes a centre stage in such ventures (Andriole, 2015). Contrary, other federal governments and businesses that do not embrace computing lags behind in every aspect. There is evolution in governance technology because the emergence of technology leads to evolution of governance. However, one should ensure evolution does not affect the dynamisms of the business. Having all parties in the ICT is essential. The role of both external and internal individuals is a significant consideration in the emergence of new participatory governance matrix utilising

Compare and contrast the possible biological risks and hazards when Essay - 1

Compare and contrast the possible biological risks and hazards when using Computed Tomography (CT), Magnetic Resonance Imaging (MRI) and Ultrasound (US) when imaging a pregnant patient - Essay Example In the process recommendations of how to reduce and ameliorate these risks are critiqued and examined A computed tomography (CT) scan utilises x-rays to provide detailed pictures of structured inside the body of pregnant women (WebMD, 2013). The process is done by getting a pregnant woman to lie on a table that is attached to a CT scanner which is round with an inner-hollow (Romans, 2010; Prokop & Galanski, 2013). The scanner sends x-rays throughout the body and the pictures are studied appropriately (Kalender, 2011). The rotation comes with pictures that are captured and saved on a computer that can be retrieved or printed. CT Scans present more detailed and thorough pictures and images of the area of interest in a medical study or examination (Patient UK, 2014). The system uses conventional radiology and as such, it opens a patient up to the risks of other x-ray systems and processes (DeMaio, 2010; Buzug, 2008). CT Scans opens up a pregnant woman to various risks of radiation during the process, however, the amount of radiation that a pregnant woman will be exposed to varies. Some authorities identify that a patient taking a pregnancy related scan will be exposed to 6.6mSv of radiation which is approximately three years’ worth of background radiation (NHS Choices, 2013). This is obviously very high and could expose a pregnant woman and a foetus to some dangerous levels of radiation. There are various levels of risks that foetuses are directly exposed to during CT scans. The level is examined in a study by Marx et al on the Uterine Radiation Dose (MRAD). The head is exposed to under 50 MRAD, the Thorax is exposed to 10-590 MRADs, the Abdomen, 2800 – 4,600 MRADs whilst the Pelvis is exposed to 1,940-5,000 MRADs (Marx, Lockberger, Walls, & Adams, 2013). However, the inherent benefit is that it is quick and accurate and it is often the best way to check a patient

Motivation Essay Example | Topics and Well Written Essays - 250 words

Motivation - Essay Example My older cousins were ranked among the best nationally and I really work hard to achieve the same level of success. However, my parents have made numerous physical promises if I achieved exemplary results in class. This is a great motivation to my learning (Weller, 2005). However, I strongly believe that idealistic concept of motivation applies to me the most. I am mostly motivated by the idea that I will be as successful as someone else will if I worked hard in class. I always harbor the idea that there is great gratification, joy, and happiness that result from hard work in class. Interestingly, I feel that the most successful and satisfied people in life are the ones who did exemplarily well in class. Such people are viewed as societal icons and are much respected (Rogers, 1999). They work less and earn more since they worked more and slept less while in school. Therefore, these ideas motivate me to learn and most importantly, maintain high level of motivation throughout my life in school. Weller, M. (2005). General principles of Motivation. Los Angeles Business Journal Retrieved from

I) Outline the sources of the English Law in the order of their Essay

I) Outline the sources of the English Law in the order of their importance. (400 words) ii) How important is Equity in this respect (400 words) - Essay Example For instance the development of non-monetary amends like injunctions and decrees of specific performance was brought in by Equity. Legislation is the commonest source of new laws or of law reform after the Seventeenth century. The most vital legislation is Acts of Parliament which is known as primary legislation. This becomes binding only after approval in the House of Commons and the House of Lords; after which it gets the Royal Assent from the Queen. The doctrine of precedent is defined as ‘The common law principle which binds a judge or a magistrate to follow previous similar decision of higher courts in the same hierarchy; also known as stare decisis† (Vickery & Pendleton 2006). The doctrine of precedent derives from common law and law of equity, which is ‘English-made’ laws that aims to be fair and treat all equally, so that the decisions by the courts are predictable and consistent in resolving disputes. There are binding and persuasive precedents, which binding precedents are known as ‘ratio decidendi’ when the final order or ‘res judicata’ by the court is made to the immediate parties, and it has a legal effect based on the key reasons for the decision. This includes passed decisions by the higher courts in the same hierarchy in similar cases, will be used for future similar cases so there are consistent remedies or sanctions under common law. An example of a precedent bei ng used was in the final decision of The House of Lords case in 1932, for the ‘Donoghue V Stevenson case.1 The House of Lords case was similar as manufacturers have the duty of care when selling their products, and ensure they are safe to consume. Therefore this precedent was legally binding and enforced by common law for a similar outcome. English law prior to the intro of the rule of equity was chiefly ruled by Common Law. Blackstone (2001) specified Common Law as â€Å"the

The Problem and its Origin Essay Example for Free

The Problem and its Origin Essay There was a time in the 20th century when the primary source of income of the people in the United States was farming. It was also during that time when the government provided economic security to the extended families. This lasted for years until they experienced Great Depression which diminished the lifetime savings of the aged and at the same time reduced the gainful employment opportunities. This was the reason why they experienced national crisis and it was because of this issue that the Social Security develop programs to address the issue. (http://waysandmeans. house. gov/media/pdf/greenbook2003/Section1. pdf) To address this problem, the Federal government granted loans to the state people and the loans were paid through direct relief or work relief. With this, the government came up with programs for emergency relief and public works. The president of the state submitted a proposal to the congress about an insurance program. This law included the establishment of two insurance programs – the Federal System of old age which was intended to help the retirees who had once been employed in the industry and commerce and the Federal State System which intended to address unemployment insurance issues. The law which was enacted by the federal government served as a supplement to the incomes of the state people who were not eligible for Social Security Survival Insurance. There was a time in the past when over 33 million people were covered by the Social Security system. Though coverage was obligatory for most of the workers, there were still about 6. 5 million workers who did not enjoy the coverage under Social Security in 2002. It was not until 1990 when the credit was replaced with a newer system which was intended to be fair between the employed and the self-employed individuals. Under this new system, there was an adjustment of the SECA tax to reflect that employees do not pay FICA taxes on the employer’s portion. Additionally, it was also specified in the system that self-employed workers were given the chance to deduct half of their SECA taxes for income tax purposes. The outline below shows those workers who were exempted from FICA and SECA taxes: (http://waysandmeans. house. gov/media/pdf/greenbook2003/Section1. pdf) o State and local government workers o Election workers o Ministers o Federal workers o College students o Household workers o Self-employed workers. The congress had required long-term estimates of the balance of the program and they had also set tax rates to ensure that the income of the program was sufficient enough to cover its outgo. The long-range projections of the system were affected by three factors – demographic factors, economic factors and factors related to Social Security programs. In their 1988 report, the trustees used an alternative method to determine their actuarial balance. This method computed the actuarial balance as the difference between the present value of income and costs for the period, which is then divided by the present value of the taxable payroll for the period. Normally, the trustees based their conclusion on the on the â€Å"closeness† of the income and cost-rates. In the long run, the projections of the trustees started troubling. For quite a number of years, the report have always projected long-term financing problems and this report had continued to show a near-term buildup of trust fund reserves and the forecast for the next 75 years. The interest which was paid to the trust funds was a way to make the fund increase until it reaches $7. 5 trillion in 2027. However, the trustees had estimated that by 2028, the fund would be insufficient to pay all benefits when all is due. It had been observed that the social security system had continuously come to a worse situation. The congress even attempted to help eliminate the long-run problem. Projections were made and that showed that Congress had stemmed the red ink for the next 75 years. However, this situation did not represent the condition of the entire period. Since 1983, the averaging period had continually deficit one (1) year at the back end and at the front end continued to drop a surplus. This had caused the condition to worsen even more. The evaluation of the income and the outgo was based on measuring the period in reaching a conclusion of whether close actuarial balance existed, in which there was a deviation from the amount. In order to meet the test of financial adequacy, the balance at the first 10-year segment must be at least 100% of the annual expenditure. This condition must be consistent with the 10-year segment of close actuarial balance. However, under these measures, the trustees made a conclusion in 2003 that the system was not as close as the actuarial balance over the long-run. There had been a deficit in between the summarized income and cost rates for about 1. 92% of the total taxable payroll. The chart below shows the social security trust funds’ end of year balances from 2003 to 2042. The projections was not based on a pessimistic assumptions but this hinge on the demographic factors which were based on the post-WWII baby boom and the general aging society. Social Welfare Policy To address this issue, Social Security implemented policies for the members to enjoy. The benefits given by the Social Security were paid to workers and to their dependents should the worker worked long enough to cover employment to be insured. There was a certain measurement used for insured status. The social security uses lifetime record of earnings which was reported under the worker’s social security number and then counting the number of quarters which were considered as covered credits. There was a time when one credit was earned for each calendar quarter. In which, the worker was paid %50 in wages for covered employment, or just received $100 for self-employed individuals. However, a worker also received a credit for each multiple of $100 in an annual earning; the total number of credits must not exceed by four though. There are two types of insured status – fully insured and currently insured. For fully insured workers, they must have a total credits which is equal to one credit for each year after dependents reach the age of 21 up to the year before they reach 62; became disabled or died, whichever came first. The fully insured status is required for the eligibility for all types of benefits. Regardless of the age of the worker, he must have a total of at least 6 credits to be fully insured. If the total number of credits of the workers reaches 40, he is insured for life. For disability insurance, workers must have a total of at least 20 credits during the 40-quarter period in which they became disabled. However, if workers are insured before the age of 31, they are immediately covered by disability insurance. In general, disability is defined to be incapable of gaining substantial activity. The impairment must be medically proven and is expected to last for not less than 12 months so workers can avail the benefits. For workers who are at least 62 years old, they are now eligible for retirement benefits. For the family of the workers, they also get to enjoy other benefits. The following summarizes the benefits that each member of the family can get: (http://waysandmeans. house. gov/media/pdf/greenbook2003/Section1. pdf) †¢ Spouse benefits – the spouse can get monthly benefit which is paid to him/her under the following conditions: (1) a currently-married spouse must be at least 62 and who is caring for more than one of the worker’s entitled children who are disabled or who have not reach the age of 16 and (2) a divorced, not married spouse of at least 62 years old. The marriage of the divorced spouse should have lasted for 10 years. The divorced spouse was entitled of the worker’s retirement. †¢ Widow(er) benefits – a monthly pay is given to a widow(er) should the widow(er) had not been married and must either be 60 years old or older or the age range is between 50 and 59 and is disabled throughout the waiting period of 5 consecutive months. †¢ Child’s benefit – the child receives a monthly benefit should the child had not been married, the child is biological or adopted and a step child or grandchild of a retiree. The child must be below 18 years old and must be a full-time elementary or secondary student who is below 19 years old. †¢ Mother’s/Father’s benefit – the mother/father of the retiree or survivor gets monthly benefit if: (1) the worker’s benefit was fully or currently insured at time of death and (2) neither the father nor the mother of the deceased worker was not married and must have one or more entitled children of the worker under his/her care. This benefit continues until the youngest child of the worker is below 16 years old and/or disabled. †¢ Parent’s benefit – a monthly survivor benefit is given to the parents of the worker should the parent have not been married or is 62 years old or older. The parents must have received half of the support from the worker at the time of the worker’s death. †¢ Lump-sum death benefit – an amount of $255 is payable upon the death of a fully- or currently-insured worker to the surviving spouse who was living with the deceased worker. If the worker has no spouse, the lump-sum benefit is paid to the child of the worker. In cases where the worker had neither spouse nor children, the lump-sum amount is not given. When beneficiaries whose income is above a certain threshold, they are then required to include a portion of their benefit to the Social Security Benefits in their federally taxable income.

Description and Evaluation of the St. Andrew Parish Church Care Centre Essay Example for Free

Description and Evaluation of the St. Andrew Parish Church Care Centre Essay Statistics have shown that in 2002 there was 16% of the Jamaican population living below the poverty line (RJR News cast). Additionally, because of restructuring of the economy and downsizing of the private sector many breadwinners have lost their jobs. This state of affairs has led to a growing number of children on the streets fending for themselves. Unemployment and poverty have led to persons reneging from their parental responsibilities of providing adequate food, shelter, clothing and supervision for their children. As a consequence of the harsh economic situation and the deteriorating social conditions, more and more children in urban centres such as Halfway Tree, have decided to congregate at the traffic lights where they can beg or earn money by wiping the windscreens of motor vehicles. Over the last twenty years this untenable phenomenon has developed. At almost every traffic light or major intersection e. g. the junctions of Trafalgar Road and Hope Road, Oxford Street and Old Hope Road, and Maxfield Avenue and Hagley Park Road, boys gather from as early as 6:00 a. m. to solicit alms from generous motorists. This development thought profitable for the boys, often caused other social problems for Jamaica. For example, many of the street boys become a nuisance as they harass motorists. Sometimes the boys would steal from motorists or even abused those who refused to give them money. Many of the boys actually live on the streets where it is reported that they become involved in pushing and taking illegal drugs. It has been reported that some are molested by homosexuals and often they are beaten up. The most unfortunate situation which has befallen the street boys is the lack of education. Very few if any of these boys who beg at the nations traffic lights can ever hope to become useful and productive adults without formal education and training. It is out of this need for strong guidance and help that the St. Andrew Parish Church established the Care Centre. Review of Literature The problem of street children has been a perpetual one that shows no signs of abatement. There have been several attempts by governments and NGOs to find ways of eliminating the problem. One needs to look at what created this phenomenon in the first place before one can determine how to solve it. It is therefore necessary to define the term street children. According to Christina Blank, in Urban Children in Distress, the term may be broadly defined as children who earn money, by legal and illegal activities on urban streets (174). She goes on to state that real street children are the roofless and rootless who live alone or with other children like themselves on the streets (324). Because these children are mobile it is extremely difficult to ascertain their numbers. It has been found that the response of those in a position to help the powerless in society, for street children may be seen as powerless, has been ad hoc or insufficient. Blank sets out various strategies and government policies that may be implemented to deal with the increasing problem of children living on the streets.

Concepts of Mergers and Acquisitions

Concepts of Mergers and Acquisitions MA CONCEPTS Introduction â€Å"The phrase Mergers and Acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying and selling and combining of different companies that can aid, finance or help a growing company in a given industry grow rapidly without having to create another business entity† The above sums up in a nutshell the concept of mergers and acquisitions. There are multiple reasons for companies to get into MA activity whether to expand into a new market or geography, to gain market share in a current market, to overcome competition or for regulatory reasons as some governments make a tie up mandatory to operate in their local economy. However it is essential to mention that in the current economic scenario MA has become an essential tool for companies to expand and grow, as successful MA strategy can be a differentiating factor for successful organization. The words and Mergers and Acquisitions are quite often used interchangeably in the current corporate world and hence can be seen in the project as well. Here is an attempt to list out some salient features which differentiate between the terms Mergers and Acquisitions. Merger A Merger can be descried as a combination of two companies into one larger company; such activities are normally voluntary in nature and involve a stock swap or cash payment to the target organization. Stock swaps allow the shareholders of both companies to share the risk involved in the deal. A merger normally results in a new company with a new brand and a new company name being created. Oxford Dictionary of Business defines mergers as â€Å"A combination of two or more businesses on an equal footing that results in the creation of a new reporting entity formed from the combining businesses. The shareholders of the combining entities mutually share the risks and rewards of the new entity and no one party to the merger obtains control over another. Acquisition Acquisitions or takeover are different from Mergers. In the case of an acquisition a company unilaterally relinquishes its independence and adopts to the acquiring firms plans. As a legal point of view the target company ceases to exist as the buyer â€Å"swallows† the business. Acquisitions have the following characteristics They are a part of a well-considered company development plan It is a unilateral process Top management structure will have fewer problems Contractual regulations are simpler Time taken for an acquisition is normally shorter than a merger. However it is essential to mention here that whether a purchase is to be considered as merger or an acquisition actually depends on the whether the purchase is friendly or hostile or in the manner it is announced. The real difference hence lies in the way it is communicated and the way it is received by the shareholders, directors and employees of the target company. History of MA Mergers and Acquisition movements were normally defined and associated with the behavior of US organizations. Various authors have tried to classify the merger movements into wave. The most prominent was Weston who in 1953 described three major periods of merger movements while studying the US business behavior. Merger waves are a very generic way to describe the predominant strategy that was being adopted by organizations in that era. This has been interpreted by the different authors in different ways depending on how they have perceived by them. However it would be wrong to consider that all organizations followed the same strategy as described in the various. The start or the first wave of the Merger movement is said to be have been post the Sherman Act in 1890. Prior to 1890 there was a predominance of the polypoly market structure, this was reduced post 1890 and partial monopolies started increasing. The economic history has been divided into Merger Waves based on the merger activities in the business world as: Period Name Facet 1889 1904 First Wave Horizontal mergers 1916 1929 Second Wave Vertical mergers 1965 1989 Third Wave Diversified conglomerate mergers 1992 1998 Fourth Wave Hostile takeovers; Corporate Raiding 2000 Fifth Wave Cross-border mergers The Great Merger Movement was primarily a US business phenomenon from 1895 to 1905. It is said that during this time 1800 of small firms disappeared into consolidations with similar firms to form large, powerful institutions that dominated their markets. The relaxation of corporate laws in the United States helped the mergers, transportation and communication networks were developed which helped achieved economies of size. The second wave (1916 to 1929) saw even greater activity in mergers. The motive behind these mergers was vertical integrations. Organizations tried to achieve technical gains and to avoid their dependence on other firms for raw materials. The third wave saw the large conglomerates looking at diversification in the 60s. the process actually reached its zenith during the merge wave and was carried to its logical extreme by the conglomerate firms that rose to prominence during that time. The fourth wave in 90s saw increase in hostile takeovers and corporate raiding by the large firms. This was a wave during which vulnerable companies were grabbed up by the larger firms. The fifth wave has been categorized as starting from the year 2000 onwards and has seen a trend of increase in Cross border acquisitions. The rise of globalization has seen increased the market for cross border MA. This rapid increase has taken many MA firms by surprise as most of them never used to consider this due to the complexity involved in cross border MA. The success of these acquisitions was also limited and we saw a vast majority of them failing. Even then in 1997 alone there were over 2300 cross border acquisition worth a total of approximately $298 Million. Source: Boston Consulting Group Research Report â€Å" The Brave New World of MA-How to Create value from MA†, July 2007 Types of Mergers and Acquisitions There are various types of mergers and acquisitions depending on the type of the business structure. The classification can be based on the type of companies merging or by the way the MA deal is being financed. Here is some type of mergers on the basis of the relationship between the two companies that are merging: Horizontal Merger- This type or a merger is between two companies that share the same product line and markets and are in direct competition with each other Vertical Merger This is between a customer and company of between a supplier and a company Market Extension Merger This between two companies that sell the same products in different geographies or markets Product Extension Merger This is between two companies that are selling different but related products in the same market. Circular Merger A circular merger is very similar to a product extension merger however in this case the products being sold are completely unrelated. The merger brings in benefits by utilizing the same channels for marketing these unrelated products, allowing shared dealerships. An example of this kind of a merger is of McLeod Russel (A Team company) with Eveready Industries ( A batteries company) in 1997. McLeod Russel however was de-merged from Eveready in 2005. Conglomeration This type of a merger is between two companies that have no common business areas. Mergers can also be classified depending on how the merger is being financed as described below Purchase Mergers This kind of a merger occurs when a company purchases another. The purchase is made through cash or through the issue of a debt instrument. Consolidation Mergers In this type of a merger a new company is formed and both the companies are bought and combined under the new entity. Type of acquisitions can be described as below Amalgamation In this type of an acquisition a new corporation is created by uniting the companies voluntarily. Acquisition/Takeover In this form one company acquires another companies total or controlling interest. The acquired company either operates as a subsidiary or can be liquidated completely. Sale of Assets A company can sell off all its assets to another and cease to exist. Holding Company Acquisition This involves the acquisition of either the total or majority of a firms stock by a company. The purpose of this form is mainly to gain management control of other companies Reverse Merger In this form of an acquisition a private company with strong prospects buys a publicly listed shell company, usually one with no business or limited assets. This helps the private company to get publicly listed in a short span of time. All mergers though have one common goal and that is to create a synergy between two companies which makes the value of the combined companies to be greater than the sum of the two companies MA Process MA process can be laid down in 3 basic phases First Phase Start with an Offer The acquiring firm once decides that they want to do a merger of acquisition, they start with an offer. The acquiring company starts working with financial advisors and investment bankers to initiate contact with the target company. The acquiring must have a strategy for a merger programme, formulated by company management and approved by the director and majority stockholders. The acquiring company also at this point does a soft due diligence with the help of publicly available data and financial advisors. The purpose of this is to arrive at an overall price that the acquiring company is willing to pay for its target in cash, shares or both. Second Phase Targets Response Once the offer has been made the target company can do one of several things mentioned below Accept the offer If the target companies top management and shareholders are happy with the offer they can simply accept the offer and go ahead with the deal. Attempt to Negotiate   If the target company management and shareholders are not satisfied with the offer they might try and work out more agreeable terms with the acquiring company. Since a lot is stake for the management of the target i.e. their jobs in particular, they might want to work out better deal to keep their jobs or leave with a big compensations package. Target companies which are highly sought after with multiple bidders would obviously have a better chance of negotiating a sweeter deal. Even manager who are crucial to the operation of an organization have a better chance of success into negotiating a good deal for them. Execute a Poison Pill or similar Hostile Takeover Defense A poison pill can be initiated by a target company if it observers a potential hostile suitor acquiring a predetermined percentage of Target company stock. To execute its defense, the target company grants all shareholders except the acquiring company options to buy additional stock at a dramatic discount. This dilutes the acquiring companys share and thwarts the potential hostile takeover attempt.  · Find a White Knight In this alternative a target company seeks out a friendlier company as a potential acquiring company. The friendlier company would offer an equal or higher price with better terms as compared to a hostile takeover bid. Third Phase or Closing the Deal Once the target company accepts the offer and all the regulatory requirements are met then the deal would be executed. The acquiring company will them pay for the target companies shares with cash, stock or both. A cash-for-stock transaction is fairly straightforward: target company shareholders receive a cash payment for each share purchased. When a company is purchased with stock, new shares from the acquiring companysstock are issued directly to the target companys shareholders, or the new shares are sent to a broker who manages them for target company shareholders GROWTH STRATEGIES Concept of Growth Growth in firms can be looked at by two broad views: organic growth, or inorganic growth. Organic growth is achieved through mainly internal expansion while inorganic growth is achieved through external expansion, i.e. through consolidations, acquisitions and mergers. Growth is something for which most companies, large or small, strive. Small firms want to get big, big firms want to get bigger. As observed by Philip B. Crosby, author of The Eternally Successful Organization, if for no other reason than to accommodate the increased expenses that develop over the years. Inflation also raises the cost of everything, and retaliatory price increases are not always possible. Salaries rise as employees gain seniority. The costs of benefits rise because of their very structure, and it is difficult to take any back, particularly if the enterprise is profitable. Therefore cost eliminations and profit improvement must be conducted on a continuing basis, and the revenues of the organization must continue to increase in order to broaden the base. Most firms, of course, desire growth in order to prosper, not just to survive. Organizational growth, however, means different things to different organizations. Indeed, there are many parameters a company can select to measure its growth. The most meaningful yardstick is one that shows progress with respect to an organizations stated goals. The ultimate goal of most companies is profit, so net profit, revenue, and other financial data are often utilized as bottom-line indications of growth. Other business owners, meanwhile, may use sales figures, number of employees, physical expansion, or other criteria to judge organizational growth. Companies which are run by a product minded entrepreneur are more concerned with the growth and profitability of a firm as an organization for the production of goods and services. While companies run by empire builders type of entrepreneurs are continuously looking at expanding the scope of the enterprise. Empire builders are not satisfied are not sa tisfied with product improvement or maintaining competitive edge In terms of access to finance there are broadly five growth stages in a companys lifespan: inception, organic growth, purchased, IPO and Beyond IPO as shown in the figure below. Each stage has its own characteristics, risks and potential financial sources. Organic Growth without MA In Organic growth, growth depends on the ability to avail the available opportunities and existing resources in a more efficient way. The extent of growth of a firm is actually determined by the ability of managers, product or market factors. There is no limit to the absolute size of the firm keeping in mind the assumption that there is no fixity of capital, labor and management and the firm is capable of acquiring these resources at a price. In addition it is also assumed that there are opportunities in the economy for investments. The economies available within the firm (such as excess productive resources or managerial capabilities) disappear after the expansion is completed as they get utilized in a new activity. This means that it is only an â€Å"entry advantage†. However the firm may have these advantages in its new operations, often set up as new subsidiaries or divisions, which may grow in response to the economies in the same manner as the rest of the firm. New operations may later be spun off from the original firm without any loss of efficiency. Further, both the original and the spun off firms will have some unused productive resources which can then be used to develop new activities Inorganic growth through MA The inorganic growth strategy is dependent on MA. The idea of acquisition is that it accelerates the business model, giving it greater impetus than organic growth. Because acquisition gives the business what it cannot get quickly or incrementally. It may be a joint venture an agreement that gives both parties something they want that the other has. Acquisition targets can include both complementary and competitive businesses complementary when the target can give something an acquirer needs or competitive when the target can stop someone else having what the acquirer wants. The risks in growth through acquisitions are significant, but they can be contained through planning and due diligence. The primary risk is integration: post the acquisition is completed the new arrangements have to work and people who were not party to the negotiation have to work together. The same goes for systems and expectations as different business would have grown in different ways. A consistent culture is laudable but a wholly consistent culture will be impossible. Add regional diversity to this and the risk would become even higher. Motivations for MA Mergers and acquisitions can be motivated by either the share-holder wealth maximizing approach or the widening share ownership. The primary objectives of MA activities are diversifications, market expansion, improving competitive position and depression immunity. Given these basic objectives a different rationale can be assigned at both individual and collective levels. From the standpoint of shareholders Investment made by shareholders in the companies subject to merger should enhance in value. The sale of shares from one companys shareholders to another and holding investment in shares should give rise to greater values i.e. the opportunity gains in alternative investments. Shareholders may gain from merger in different ways viz. from the gains and achievements of the company i.e. through Realization of monopoly profits; Economies of scales; Diversification of product line; Acquisition of human assets and other resources not available otherwise; Better investment opportunity in combinations. One or more features would generally be available in each merger where shareholders may have attraction and favor merger. From the standpoint of managers Managers are concerned with improving operations of the company, managing the affairs of the company effectively for all round gains and growth of the company which will provide them better deals in raising their status, perks and fringe benefits. Mergers where all these things are the guaranteed outcome get support from the managers. At the same time, where managers have fear of displacement at the hands of new management in amalgamated company and also resultant depreciation from the merger then support from them becomes difficult. Promoters gains Mergers do offer to company promoters the advantage of increasing the size of their company and the financial structure and strength. They can convert a closely held and private limited company into a public company without contributing much wealth and without losing control. Benefits to general public Impact of mergers on general public could be viewed as aspect of benefits and costs to: Consumer of the product or services; Workers of the companies under combination; General public affected in general having not been user or consumer or the worker in the companies under merger plan. VALUATION OF TARGET COMPANIES Valuation of target companies is an essential step in the MA process. Due Diligence Due Diligence of a company; answers the question of whether a deal is being done at the right time at the right price for the right reasons. It involves an investigation into the affairs of an entity and results in the production of a report detailing relevant data and points. The investigation is performed prior to the businesss acquisition, flotation, restructuring or other transactions Due Diligence is performed by many advisors on the team. For example there may be a separate legal due diligence, financial due diligence, tax due diligence, environmental due diligence, commercial due diligence, and information technology due diligence. Financial due diligence is a vital part of the MA process. Often a problem in the financial due diligence raises point to be dealt by other areas as well, for example a financial due diligence may uncover an unusual lease obligation which then feeds into the legal due diligence. What a due diligence involves Each MA transaction is unique in its own sense hence the scope and extent of a due diligence process needs to be tailored to fit the needs of the buyer. However broadly it should cover the following aspects: The history and commercial activities of the business The organizational structure and employees Employee benefits and labor matters Its accounting policies The information systems A detailed review of financial statements A review of the financial projections Anything else the team may uncover that is relevant for the transaction Methods of Valuation The valuation of a target company normally depends on a lot of factors, it is not sufficient to evaluate the financial aspect alone. This is possible through a valuation of the 5 Ps which are: Personnel  ­- senior management of the target company play an important role in an acquisition. The acquiring firm considers the motivation, energy and intelligence levels of the existing personnel before taking them on. Product Proprietary products of a Target company increase the value of the company. Plant The plant capacity and condition of equipments also affect the valuation of a company. Potential The potential of a firms growth as compared to the industry is also a factor in its valuation Profit The declared profits of the firm is the basis of determining price. It is normally considered easier to evaluate public limited since most of the above data is publicly available in their annually published reports. In the case of a Private company it is a little more challenging to get the same information and the Acquiring company has to depend on a proper due diligence process to complete its valuation. Financial Valuation Financial valuation should answer the simple, but vital, question â€Å"What is something worth?† The analysis of target is hence based on either current projections or of the future. The process of valuations differ substantially for a listed and unlisted companies Many types of valuation metrics are used, involving several sets of metrics. On of the most common is the standard P/E ration (Price to earnings ratio) however some of the other metrics include assets value, capitalized earnings, market value, investment value, book value, costs basis valuation, enterprise value and some combined methods as well. P/E Ratio and Market Price For an unlisted company the P/E ratio of a comparable listed company is referred to and discounted based on the voting rights in the company. For listed companies the modes of valuation can be based on either earnings or assets. The market price of shares reflects the earnings per share (EPS). P/E ratio Calculated as: The P/E ratio is the current price of shares divided by the EPS. The higher the P/E ratio the higher are the future earnings expectation The P/E multiple is calculated as the multiple of net profit used to compute the companys purchase price. For example, an investor attempting to recover his initial investment in 10 years would have to earn an after-tax return of 10% on investment, plus adjustment for discounted cash flow and inflation. Discounted Cash Flow (DCF) analysis uses future free cash flow projections and discounts them (most often using the weighted average cost of capital) to arrive at a present value. DCF is calculated as: Assets Value Tangible assets, such as land and buildings, and intangible assets are assessed as per existing business practices. Goodwill is based on the companys excess earning power for certain number of years. The asset basis valuation is either on the fair value or the open market value. The dividend approach and the super profit approach can also be used for asset valuation. In the dividend, the present share prices are taken as the values of future dividends. While the super profit approach expects to get more value for a firm in addition to the value of the net assets. Capitalized Earnings This method is based on the rate of return on the capital employed Market Value This is on the basis of quoted share values at the stock exchange. Investment Value This is the cost of establishing an enterprise such as the target company and the interest on the same. Book Value This is the secondary factor in valuations and takes into account the total worth of the assets after depreciation. If the P/E multiplier is less than the book value then the book value has to be adjusted to reflect the true value. It takes into account the present net value of the real estate, machinery and equipment. Sometimes the book value may be understated in times of inflation and overstated during depression. Cost Basis Valuation This is cost minus depreciation. Intangible assets are not taken into account. Reproduction Cost This is the current cost of replacement of properties with similar design and material. Substitution Cost Substitution cost is the cost of construction of the same utility and capacity. Enterprise Value The valuation of a company is based on the Enterprise Value (EV) and its ratio to the companys sales and operating profit (PBIDT Profit before interest, depreciation and tax). Enterprise Value is calculated as: A = Market Capitalization of Stock + Total Debt on Companys books B = Investments + Cash EV = (B A) Accounting Methods The method accounting also has a significant impact on the valuation and price the seller will receive. The acquiring firm can use two principal accounting methods for valuations, they can either use the pooling of interests method or the purchase method. The main difference between them is the value that the combined firms balance sheet places on the assets of the acquired firm, as well as the depreciation allowances and charges against income following the merger. Pooling of Interests Method The pooling of interests method assumes that the transaction is simply an exchange of equity securities. Therefore, the capital stock account of the target firm is eliminated, and the acquirer issues new stock to replace it. The two firms assets and liabilities are combined at their historical book values as of the acquisition date. The end result of a pooling of interests transaction is that the total assets of the combined firm are equal to the sum of the assets of the individual firms. No goodwill is generated, and there are no charges against earnings. A tax-free acquisition would normally be reported as a pooling of interests. Purchase Method   In this method, assets and liabilities are shown on the merged firms books at their market (not book) values as of the acquisition date. This method is based on the idea that the resulting values should reflect the market values established during the bargaining process. The total liabilities of the combined firm equal the sum of the two firms individual liabilities. The equity of the acquiring firm is increased by the amount of the purchase price. Mark Up Pricing/ Premium Markup pricing or premium is the percentage difference between the trading price of the target companies stock before the announcement of acquisition and the price per share paid by the acquiring firm. Bidding firms pay large premiums to acquire control of exchange-listed target firms. Normally premiums include pre-bid run up in the target firms stock price as part of the control premium paid by the winning bidders. The valuations by the bidder and the target depend on the information each party has at the time of the negotiation. Mark Up or premium is partly decided on the basis of the relationship pattern of the acquiring firm. The pattern in some cases is that if interlocking directorship among firms. Most firms have stable and long standing relationships with professionals such as attorneys, investment bankers and accountants. These are likely to have similar effects as to interlock directorships. Managers take advice from both their interlock partners and professional firms when deciding how much to pay. Financing an MA Organizations use various methods for financing an MA deal. Often combinations of the below mentioned methods: Cash Cash payments. These are normally preferred since the organization does not have to dilute equity and there will be no change in the number of shares outstanding. Also cash transactions save time and cash can be re-invested at the face value. Financing Financing capital may be borrowed from banks or raised from issue of bonds. Acquisitions that are financed through debt are called as leveraged buyouts if they take the target private, and the debt will often be moved down into the balance sheet of the acquired company. Hybrids An acquisition can involve a combination of cash and debt or of cash and stock of the purchasing entity. POST ACQUISITION INTEGRATION After the acquisition is completed, the acquired company needs to be integrated with the acquiring company. The process of integration actually needs to be planned during the acquisition itself to ensure that the company integrates smoothly. The success of integration also depends on the managers who are responsible for the implementation. Planning The acquiring company needs to plan the post acquisition integration period. IN the initial period the target company is more receptive to drastic changes to make the company viable. Some of the basic approaches are as follows Adapting a program This should be completely aligned with the companies goals and objectives of the company and should also take into account the limitations of the company. Effective organization and leadership structure The integration process involves creating a group which focuses on creating value through specific activities and actions. A true partnership would mean involving the senior leadership of the acquired company as well in this strategic group. Minimize post acquisition exodus of critical resources It is critical to have a preventing plan in place to minimize the damage that maybe caused to the new enterprise. Any loss of critical things like market standing, key employees, brand has to be avoided. Employee issues The empl Concepts of Mergers and Acquisitions Concepts of Mergers and Acquisitions MA CONCEPTS Introduction â€Å"The phrase Mergers and Acquisitions refers to the aspect of corporate strategy, corporate finance and management dealing with the buying and selling and combining of different companies that can aid, finance or help a growing company in a given industry grow rapidly without having to create another business entity† The above sums up in a nutshell the concept of mergers and acquisitions. There are multiple reasons for companies to get into MA activity whether to expand into a new market or geography, to gain market share in a current market, to overcome competition or for regulatory reasons as some governments make a tie up mandatory to operate in their local economy. However it is essential to mention that in the current economic scenario MA has become an essential tool for companies to expand and grow, as successful MA strategy can be a differentiating factor for successful organization. The words and Mergers and Acquisitions are quite often used interchangeably in the current corporate world and hence can be seen in the project as well. Here is an attempt to list out some salient features which differentiate between the terms Mergers and Acquisitions. Merger A Merger can be descried as a combination of two companies into one larger company; such activities are normally voluntary in nature and involve a stock swap or cash payment to the target organization. Stock swaps allow the shareholders of both companies to share the risk involved in the deal. A merger normally results in a new company with a new brand and a new company name being created. Oxford Dictionary of Business defines mergers as â€Å"A combination of two or more businesses on an equal footing that results in the creation of a new reporting entity formed from the combining businesses. The shareholders of the combining entities mutually share the risks and rewards of the new entity and no one party to the merger obtains control over another. Acquisition Acquisitions or takeover are different from Mergers. In the case of an acquisition a company unilaterally relinquishes its independence and adopts to the acquiring firms plans. As a legal point of view the target company ceases to exist as the buyer â€Å"swallows† the business. Acquisitions have the following characteristics They are a part of a well-considered company development plan It is a unilateral process Top management structure will have fewer problems Contractual regulations are simpler Time taken for an acquisition is normally shorter than a merger. However it is essential to mention here that whether a purchase is to be considered as merger or an acquisition actually depends on the whether the purchase is friendly or hostile or in the manner it is announced. The real difference hence lies in the way it is communicated and the way it is received by the shareholders, directors and employees of the target company. History of MA Mergers and Acquisition movements were normally defined and associated with the behavior of US organizations. Various authors have tried to classify the merger movements into wave. The most prominent was Weston who in 1953 described three major periods of merger movements while studying the US business behavior. Merger waves are a very generic way to describe the predominant strategy that was being adopted by organizations in that era. This has been interpreted by the different authors in different ways depending on how they have perceived by them. However it would be wrong to consider that all organizations followed the same strategy as described in the various. The start or the first wave of the Merger movement is said to be have been post the Sherman Act in 1890. Prior to 1890 there was a predominance of the polypoly market structure, this was reduced post 1890 and partial monopolies started increasing. The economic history has been divided into Merger Waves based on the merger activities in the business world as: Period Name Facet 1889 1904 First Wave Horizontal mergers 1916 1929 Second Wave Vertical mergers 1965 1989 Third Wave Diversified conglomerate mergers 1992 1998 Fourth Wave Hostile takeovers; Corporate Raiding 2000 Fifth Wave Cross-border mergers The Great Merger Movement was primarily a US business phenomenon from 1895 to 1905. It is said that during this time 1800 of small firms disappeared into consolidations with similar firms to form large, powerful institutions that dominated their markets. The relaxation of corporate laws in the United States helped the mergers, transportation and communication networks were developed which helped achieved economies of size. The second wave (1916 to 1929) saw even greater activity in mergers. The motive behind these mergers was vertical integrations. Organizations tried to achieve technical gains and to avoid their dependence on other firms for raw materials. The third wave saw the large conglomerates looking at diversification in the 60s. the process actually reached its zenith during the merge wave and was carried to its logical extreme by the conglomerate firms that rose to prominence during that time. The fourth wave in 90s saw increase in hostile takeovers and corporate raiding by the large firms. This was a wave during which vulnerable companies were grabbed up by the larger firms. The fifth wave has been categorized as starting from the year 2000 onwards and has seen a trend of increase in Cross border acquisitions. The rise of globalization has seen increased the market for cross border MA. This rapid increase has taken many MA firms by surprise as most of them never used to consider this due to the complexity involved in cross border MA. The success of these acquisitions was also limited and we saw a vast majority of them failing. Even then in 1997 alone there were over 2300 cross border acquisition worth a total of approximately $298 Million. Source: Boston Consulting Group Research Report â€Å" The Brave New World of MA-How to Create value from MA†, July 2007 Types of Mergers and Acquisitions There are various types of mergers and acquisitions depending on the type of the business structure. The classification can be based on the type of companies merging or by the way the MA deal is being financed. Here is some type of mergers on the basis of the relationship between the two companies that are merging: Horizontal Merger- This type or a merger is between two companies that share the same product line and markets and are in direct competition with each other Vertical Merger This is between a customer and company of between a supplier and a company Market Extension Merger This between two companies that sell the same products in different geographies or markets Product Extension Merger This is between two companies that are selling different but related products in the same market. Circular Merger A circular merger is very similar to a product extension merger however in this case the products being sold are completely unrelated. The merger brings in benefits by utilizing the same channels for marketing these unrelated products, allowing shared dealerships. An example of this kind of a merger is of McLeod Russel (A Team company) with Eveready Industries ( A batteries company) in 1997. McLeod Russel however was de-merged from Eveready in 2005. Conglomeration This type of a merger is between two companies that have no common business areas. Mergers can also be classified depending on how the merger is being financed as described below Purchase Mergers This kind of a merger occurs when a company purchases another. The purchase is made through cash or through the issue of a debt instrument. Consolidation Mergers In this type of a merger a new company is formed and both the companies are bought and combined under the new entity. Type of acquisitions can be described as below Amalgamation In this type of an acquisition a new corporation is created by uniting the companies voluntarily. Acquisition/Takeover In this form one company acquires another companies total or controlling interest. The acquired company either operates as a subsidiary or can be liquidated completely. Sale of Assets A company can sell off all its assets to another and cease to exist. Holding Company Acquisition This involves the acquisition of either the total or majority of a firms stock by a company. The purpose of this form is mainly to gain management control of other companies Reverse Merger In this form of an acquisition a private company with strong prospects buys a publicly listed shell company, usually one with no business or limited assets. This helps the private company to get publicly listed in a short span of time. All mergers though have one common goal and that is to create a synergy between two companies which makes the value of the combined companies to be greater than the sum of the two companies MA Process MA process can be laid down in 3 basic phases First Phase Start with an Offer The acquiring firm once decides that they want to do a merger of acquisition, they start with an offer. The acquiring company starts working with financial advisors and investment bankers to initiate contact with the target company. The acquiring must have a strategy for a merger programme, formulated by company management and approved by the director and majority stockholders. The acquiring company also at this point does a soft due diligence with the help of publicly available data and financial advisors. The purpose of this is to arrive at an overall price that the acquiring company is willing to pay for its target in cash, shares or both. Second Phase Targets Response Once the offer has been made the target company can do one of several things mentioned below Accept the offer If the target companies top management and shareholders are happy with the offer they can simply accept the offer and go ahead with the deal. Attempt to Negotiate   If the target company management and shareholders are not satisfied with the offer they might try and work out more agreeable terms with the acquiring company. Since a lot is stake for the management of the target i.e. their jobs in particular, they might want to work out better deal to keep their jobs or leave with a big compensations package. Target companies which are highly sought after with multiple bidders would obviously have a better chance of negotiating a sweeter deal. Even manager who are crucial to the operation of an organization have a better chance of success into negotiating a good deal for them. Execute a Poison Pill or similar Hostile Takeover Defense A poison pill can be initiated by a target company if it observers a potential hostile suitor acquiring a predetermined percentage of Target company stock. To execute its defense, the target company grants all shareholders except the acquiring company options to buy additional stock at a dramatic discount. This dilutes the acquiring companys share and thwarts the potential hostile takeover attempt.  · Find a White Knight In this alternative a target company seeks out a friendlier company as a potential acquiring company. The friendlier company would offer an equal or higher price with better terms as compared to a hostile takeover bid. Third Phase or Closing the Deal Once the target company accepts the offer and all the regulatory requirements are met then the deal would be executed. The acquiring company will them pay for the target companies shares with cash, stock or both. A cash-for-stock transaction is fairly straightforward: target company shareholders receive a cash payment for each share purchased. When a company is purchased with stock, new shares from the acquiring companysstock are issued directly to the target companys shareholders, or the new shares are sent to a broker who manages them for target company shareholders GROWTH STRATEGIES Concept of Growth Growth in firms can be looked at by two broad views: organic growth, or inorganic growth. Organic growth is achieved through mainly internal expansion while inorganic growth is achieved through external expansion, i.e. through consolidations, acquisitions and mergers. Growth is something for which most companies, large or small, strive. Small firms want to get big, big firms want to get bigger. As observed by Philip B. Crosby, author of The Eternally Successful Organization, if for no other reason than to accommodate the increased expenses that develop over the years. Inflation also raises the cost of everything, and retaliatory price increases are not always possible. Salaries rise as employees gain seniority. The costs of benefits rise because of their very structure, and it is difficult to take any back, particularly if the enterprise is profitable. Therefore cost eliminations and profit improvement must be conducted on a continuing basis, and the revenues of the organization must continue to increase in order to broaden the base. Most firms, of course, desire growth in order to prosper, not just to survive. Organizational growth, however, means different things to different organizations. Indeed, there are many parameters a company can select to measure its growth. The most meaningful yardstick is one that shows progress with respect to an organizations stated goals. The ultimate goal of most companies is profit, so net profit, revenue, and other financial data are often utilized as bottom-line indications of growth. Other business owners, meanwhile, may use sales figures, number of employees, physical expansion, or other criteria to judge organizational growth. Companies which are run by a product minded entrepreneur are more concerned with the growth and profitability of a firm as an organization for the production of goods and services. While companies run by empire builders type of entrepreneurs are continuously looking at expanding the scope of the enterprise. Empire builders are not satisfied are not sa tisfied with product improvement or maintaining competitive edge In terms of access to finance there are broadly five growth stages in a companys lifespan: inception, organic growth, purchased, IPO and Beyond IPO as shown in the figure below. Each stage has its own characteristics, risks and potential financial sources. Organic Growth without MA In Organic growth, growth depends on the ability to avail the available opportunities and existing resources in a more efficient way. The extent of growth of a firm is actually determined by the ability of managers, product or market factors. There is no limit to the absolute size of the firm keeping in mind the assumption that there is no fixity of capital, labor and management and the firm is capable of acquiring these resources at a price. In addition it is also assumed that there are opportunities in the economy for investments. The economies available within the firm (such as excess productive resources or managerial capabilities) disappear after the expansion is completed as they get utilized in a new activity. This means that it is only an â€Å"entry advantage†. However the firm may have these advantages in its new operations, often set up as new subsidiaries or divisions, which may grow in response to the economies in the same manner as the rest of the firm. New operations may later be spun off from the original firm without any loss of efficiency. Further, both the original and the spun off firms will have some unused productive resources which can then be used to develop new activities Inorganic growth through MA The inorganic growth strategy is dependent on MA. The idea of acquisition is that it accelerates the business model, giving it greater impetus than organic growth. Because acquisition gives the business what it cannot get quickly or incrementally. It may be a joint venture an agreement that gives both parties something they want that the other has. Acquisition targets can include both complementary and competitive businesses complementary when the target can give something an acquirer needs or competitive when the target can stop someone else having what the acquirer wants. The risks in growth through acquisitions are significant, but they can be contained through planning and due diligence. The primary risk is integration: post the acquisition is completed the new arrangements have to work and people who were not party to the negotiation have to work together. The same goes for systems and expectations as different business would have grown in different ways. A consistent culture is laudable but a wholly consistent culture will be impossible. Add regional diversity to this and the risk would become even higher. Motivations for MA Mergers and acquisitions can be motivated by either the share-holder wealth maximizing approach or the widening share ownership. The primary objectives of MA activities are diversifications, market expansion, improving competitive position and depression immunity. Given these basic objectives a different rationale can be assigned at both individual and collective levels. From the standpoint of shareholders Investment made by shareholders in the companies subject to merger should enhance in value. The sale of shares from one companys shareholders to another and holding investment in shares should give rise to greater values i.e. the opportunity gains in alternative investments. Shareholders may gain from merger in different ways viz. from the gains and achievements of the company i.e. through Realization of monopoly profits; Economies of scales; Diversification of product line; Acquisition of human assets and other resources not available otherwise; Better investment opportunity in combinations. One or more features would generally be available in each merger where shareholders may have attraction and favor merger. From the standpoint of managers Managers are concerned with improving operations of the company, managing the affairs of the company effectively for all round gains and growth of the company which will provide them better deals in raising their status, perks and fringe benefits. Mergers where all these things are the guaranteed outcome get support from the managers. At the same time, where managers have fear of displacement at the hands of new management in amalgamated company and also resultant depreciation from the merger then support from them becomes difficult. Promoters gains Mergers do offer to company promoters the advantage of increasing the size of their company and the financial structure and strength. They can convert a closely held and private limited company into a public company without contributing much wealth and without losing control. Benefits to general public Impact of mergers on general public could be viewed as aspect of benefits and costs to: Consumer of the product or services; Workers of the companies under combination; General public affected in general having not been user or consumer or the worker in the companies under merger plan. VALUATION OF TARGET COMPANIES Valuation of target companies is an essential step in the MA process. Due Diligence Due Diligence of a company; answers the question of whether a deal is being done at the right time at the right price for the right reasons. It involves an investigation into the affairs of an entity and results in the production of a report detailing relevant data and points. The investigation is performed prior to the businesss acquisition, flotation, restructuring or other transactions Due Diligence is performed by many advisors on the team. For example there may be a separate legal due diligence, financial due diligence, tax due diligence, environmental due diligence, commercial due diligence, and information technology due diligence. Financial due diligence is a vital part of the MA process. Often a problem in the financial due diligence raises point to be dealt by other areas as well, for example a financial due diligence may uncover an unusual lease obligation which then feeds into the legal due diligence. What a due diligence involves Each MA transaction is unique in its own sense hence the scope and extent of a due diligence process needs to be tailored to fit the needs of the buyer. However broadly it should cover the following aspects: The history and commercial activities of the business The organizational structure and employees Employee benefits and labor matters Its accounting policies The information systems A detailed review of financial statements A review of the financial projections Anything else the team may uncover that is relevant for the transaction Methods of Valuation The valuation of a target company normally depends on a lot of factors, it is not sufficient to evaluate the financial aspect alone. This is possible through a valuation of the 5 Ps which are: Personnel  ­- senior management of the target company play an important role in an acquisition. The acquiring firm considers the motivation, energy and intelligence levels of the existing personnel before taking them on. Product Proprietary products of a Target company increase the value of the company. Plant The plant capacity and condition of equipments also affect the valuation of a company. Potential The potential of a firms growth as compared to the industry is also a factor in its valuation Profit The declared profits of the firm is the basis of determining price. It is normally considered easier to evaluate public limited since most of the above data is publicly available in their annually published reports. In the case of a Private company it is a little more challenging to get the same information and the Acquiring company has to depend on a proper due diligence process to complete its valuation. Financial Valuation Financial valuation should answer the simple, but vital, question â€Å"What is something worth?† The analysis of target is hence based on either current projections or of the future. The process of valuations differ substantially for a listed and unlisted companies Many types of valuation metrics are used, involving several sets of metrics. On of the most common is the standard P/E ration (Price to earnings ratio) however some of the other metrics include assets value, capitalized earnings, market value, investment value, book value, costs basis valuation, enterprise value and some combined methods as well. P/E Ratio and Market Price For an unlisted company the P/E ratio of a comparable listed company is referred to and discounted based on the voting rights in the company. For listed companies the modes of valuation can be based on either earnings or assets. The market price of shares reflects the earnings per share (EPS). P/E ratio Calculated as: The P/E ratio is the current price of shares divided by the EPS. The higher the P/E ratio the higher are the future earnings expectation The P/E multiple is calculated as the multiple of net profit used to compute the companys purchase price. For example, an investor attempting to recover his initial investment in 10 years would have to earn an after-tax return of 10% on investment, plus adjustment for discounted cash flow and inflation. Discounted Cash Flow (DCF) analysis uses future free cash flow projections and discounts them (most often using the weighted average cost of capital) to arrive at a present value. DCF is calculated as: Assets Value Tangible assets, such as land and buildings, and intangible assets are assessed as per existing business practices. Goodwill is based on the companys excess earning power for certain number of years. The asset basis valuation is either on the fair value or the open market value. The dividend approach and the super profit approach can also be used for asset valuation. In the dividend, the present share prices are taken as the values of future dividends. While the super profit approach expects to get more value for a firm in addition to the value of the net assets. Capitalized Earnings This method is based on the rate of return on the capital employed Market Value This is on the basis of quoted share values at the stock exchange. Investment Value This is the cost of establishing an enterprise such as the target company and the interest on the same. Book Value This is the secondary factor in valuations and takes into account the total worth of the assets after depreciation. If the P/E multiplier is less than the book value then the book value has to be adjusted to reflect the true value. It takes into account the present net value of the real estate, machinery and equipment. Sometimes the book value may be understated in times of inflation and overstated during depression. Cost Basis Valuation This is cost minus depreciation. Intangible assets are not taken into account. Reproduction Cost This is the current cost of replacement of properties with similar design and material. Substitution Cost Substitution cost is the cost of construction of the same utility and capacity. Enterprise Value The valuation of a company is based on the Enterprise Value (EV) and its ratio to the companys sales and operating profit (PBIDT Profit before interest, depreciation and tax). Enterprise Value is calculated as: A = Market Capitalization of Stock + Total Debt on Companys books B = Investments + Cash EV = (B A) Accounting Methods The method accounting also has a significant impact on the valuation and price the seller will receive. The acquiring firm can use two principal accounting methods for valuations, they can either use the pooling of interests method or the purchase method. The main difference between them is the value that the combined firms balance sheet places on the assets of the acquired firm, as well as the depreciation allowances and charges against income following the merger. Pooling of Interests Method The pooling of interests method assumes that the transaction is simply an exchange of equity securities. Therefore, the capital stock account of the target firm is eliminated, and the acquirer issues new stock to replace it. The two firms assets and liabilities are combined at their historical book values as of the acquisition date. The end result of a pooling of interests transaction is that the total assets of the combined firm are equal to the sum of the assets of the individual firms. No goodwill is generated, and there are no charges against earnings. A tax-free acquisition would normally be reported as a pooling of interests. Purchase Method   In this method, assets and liabilities are shown on the merged firms books at their market (not book) values as of the acquisition date. This method is based on the idea that the resulting values should reflect the market values established during the bargaining process. The total liabilities of the combined firm equal the sum of the two firms individual liabilities. The equity of the acquiring firm is increased by the amount of the purchase price. Mark Up Pricing/ Premium Markup pricing or premium is the percentage difference between the trading price of the target companies stock before the announcement of acquisition and the price per share paid by the acquiring firm. Bidding firms pay large premiums to acquire control of exchange-listed target firms. Normally premiums include pre-bid run up in the target firms stock price as part of the control premium paid by the winning bidders. The valuations by the bidder and the target depend on the information each party has at the time of the negotiation. Mark Up or premium is partly decided on the basis of the relationship pattern of the acquiring firm. The pattern in some cases is that if interlocking directorship among firms. Most firms have stable and long standing relationships with professionals such as attorneys, investment bankers and accountants. These are likely to have similar effects as to interlock directorships. Managers take advice from both their interlock partners and professional firms when deciding how much to pay. Financing an MA Organizations use various methods for financing an MA deal. Often combinations of the below mentioned methods: Cash Cash payments. These are normally preferred since the organization does not have to dilute equity and there will be no change in the number of shares outstanding. Also cash transactions save time and cash can be re-invested at the face value. Financing Financing capital may be borrowed from banks or raised from issue of bonds. Acquisitions that are financed through debt are called as leveraged buyouts if they take the target private, and the debt will often be moved down into the balance sheet of the acquired company. Hybrids An acquisition can involve a combination of cash and debt or of cash and stock of the purchasing entity. POST ACQUISITION INTEGRATION After the acquisition is completed, the acquired company needs to be integrated with the acquiring company. The process of integration actually needs to be planned during the acquisition itself to ensure that the company integrates smoothly. The success of integration also depends on the managers who are responsible for the implementation. Planning The acquiring company needs to plan the post acquisition integration period. IN the initial period the target company is more receptive to drastic changes to make the company viable. Some of the basic approaches are as follows Adapting a program This should be completely aligned with the companies goals and objectives of the company and should also take into account the limitations of the company. Effective organization and leadership structure The integration process involves creating a group which focuses on creating value through specific activities and actions. A true partnership would mean involving the senior leadership of the acquired company as well in this strategic group. Minimize post acquisition exodus of critical resources It is critical to have a preventing plan in place to minimize the damage that maybe caused to the new enterprise. Any loss of critical things like market standing, key employees, brand has to be avoided. Employee issues The empl