Page 61 - REC :: MBA CURRICULUM AND SYLLABUS :: R2019

Subject Code Subject Name (Theory course) Category L T P C
BA19P14 Mergers, Acquisitions And Corporate Restructuring FE 3 0 0 3

Objectives:
 The course will enable the learner to understand the basic types of MERGERS, their benefits.
 To critically evaluate and analyze various Pricing / Business Valuation models which in turn will help them in
understanding the perspectives, motives behind mergers and consolidation.
 Students may also become acquainted with the technical, financial and statutory boundaries within which such
mergers and acquisitions are achieved.

UNIT-I Definition of Mergers- Strategic Motives - rationale behind - theories of mergers – meaning types 9
- operating, financial and managerial synergy – creation of synergy -value creation in horizontal,
vertical and conglomerate mergers - factors internal and external factors -contributing to Mergers
and Acquisitions.

UNIT-II Corporate restructuring – different methods of restructuring - Explain Differentiate between sell 9
off / spin off/ divestitures /equity carve out – leveraged buy outs (LBO) - management buy outs -
employee stock ownership plans (ESOP).

UNIT-III M&A process - Five-stage model – due diligence - Process of merger integration – organizational 9
and human aspects – managerial challenges of M & A – Takeovers – types - hostile takeover
approaches - anti takeover defences - Financial defensive measures – Coercive offers and defense
– anti-takeover amendments – Define poison pill.

UNIT-IV Approaches to valuation -discounted cash flow valuation – relative valuation – valuation of 9
operating and financial synergy - valuing corporate control – valuing of LBO - Methods of
financing mergers – estimating swap ratio.

UNIT-V Accounting for amalgamation – pooling of interest method, purchase method – procedure laid 9
down under Indian companies act of 1956 with regard to accounting for amalgamation –
Managing Post-Merger Issues - Legalities Involved in Merger, Acquisition and Take-over -
Ethical Issues of Merger and Take-over.

Total Contact Hours : 45

Course Outcomes:On completion of course, students will be able to:
 Apply the concept of mergers in value creation.
 Differentiate between sell off / spin off/ divestitures /equity carve out – LBO.
 Analyse and apply takeover tactics and defences.
 Apply valuation techniques.
 Critically evaluate the role of legal issues and ethical issues relating to mergers and acquisitions.
Text Book (s):
Fred Weston, Kwang S Chung, Susan E Hoag – Mergers, Restructuring And
1 th
Corporate Control – Pearson Education, 4 edition.
2 AswathDamodaran – Corporate Finance-Theory And Practice – John Wiley & Sons.
Merger Acquisitions & Corporate Restructuring – Chandrashekar Krishna Murthy &
3
Vishwanath. S.R – Sage Publication.
4 Ramanujam et al – Mergers – TMH, 2003.
5 Gerard Picot Handbook of International Mergers & Acquisitions –-Palgrave Publishers Ltd.

Reference Books(s) / Web links:
SudiSudarsanam – Value Creation From Mergers And Acquisitions – Pearson
1
Education, 1/e, 2003.
th
Weston, Mitchell And Mulherin - Takeovers, Restructuring And Corporate Governance – PearsonEducation, 4
2
edition, 2003.
3 Shukla&Grewal- Advanced Accounts Vol. 2 – S.Chand& Sons,
Mergers and Acquisitions, Rajinder S. Aurora, KavitaShetty and Sharad R. Kale,
4
Oxford University Press,2011.
5 NishikantJha, Mergers, acquisitions and Corporate Restructuring, HimalayaPublishing House,2011.

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