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Essay / Research Paper Abstract
This 6 page paper looks at the potential acquisition of GM's European interests, including Opel and Vauxhall. By Canadian firm Magna. The paper considers different issues that may be of concern to the firm, including the future of the automotive industry and the role of emerging markets, the ability to work with Russian investors, how the assets may be leveraged and currency exchange rate risks. The bibliography cites 10 sources.
Page Count:
6 pages (~225 words per page)
File: TS14_TEmagnaGM.rtf
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Unformatted sample text from the term paper:
General Motors European operations, including the Vauxhall and Opel brands. However taking on these companies will present Magna with several challenges as well as opportunities, therefore, these potential issues need
to be considered before going ahead with the offer and potential acquisition and many acquisitions fail to give the expected value, and poor planning may compromise results, not all acquisitions
will succeed, as seen with BMWs acquisition of Rover and the Daimler Chrysler failure (Thompson, 2007). The gaining of value from an acquisition can be problematic, even more so where
there are international cultural issues to contend with and failure is likely if there is not a meeting of minds and cultures (Epstein, 2004). It is not only the internal
issues, there is also the need for the firm to consider how they will be able to leverage the resources and access to markets that they will gain if they
want to create value (Mintzberg et al, 2008). The following are my findings for the issues raised cornering the proposed acquisition. Question 1; The Automotive Industry
The acquisition of Vauxhall and Opel will increase the size of the European Operations significantly. At first glance this may not appear to offer
many advantages, the central and eastern European car market is performing badly at the current time, in the first quarter of 2009 only 100,152 cars were sold, this is a
decrease of 31.8% on the same period in the previous year, and Opel were loosing more than many other firms, with Opel sales down 37.8% (just-autos, 2009). The western European
market is also performing poorly; by April 2009 there was a year on year fall of 12.3% fall in sales (just-autos, 2009). Therefore there are difficult trading conditions and as
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