The Role of Hr in Mergers and Acquistions
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- Date Submitted: 02/27/2010 10:08 AM
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Introduction
A combination of two or more companies to form a new company is known to be a merger, while an acquisition is the purchase of one or more companies by another with no new company being formed. A merger is said to occur when one organization assumes all the assets and liabilities of another organization. In this process of acquisition, the acquiring firm retains its identity, while the acquired firm becomes non-existent with no identity of its own while for a merger to happen a majority vote of shareholders is compulsory. A merger can also be seen as a type of acquisition.
Why Mergers and Acquisitions??
Mergers and acquisitions happen when one firm becomes too weak to carry on its own i.e. the major players dominate the market to such a great extent that small players are just not able to cope up. It may also happen that sometimes organizations realize that their potential, efficiency and profitability will get a boost if they work in collaboration with other organization.
Laws governing Mergers and Acquisitions
State and federal laws have been laid down so as to govern and control the mergers and acquisitions of organizations. State law lays down a path so as to ensure fair practices during a merger or acquisition by establishing judicial oversights, procedures and guidelines for the approval of mergers so on and so forth which has made the merger and acquisition procedures friendly and negotiated transactions.
The HR perspective of Mergers and Acquisitions
Getting to grips with a company merger or acquisition is one of the most challenging issues HR professionals face. Understanding the employment law issues along with critical people issues like leadership, employee communications, talent retention and cultural alignment are very important for success and can contribute to a makeover of the long term merit of the transaction. With the high degree and overseas activity in this complex area and the increasing role of HR in the M&A...
A combination of two or more companies to form a new company is known to be a merger, while an acquisition is the purchase of one or more companies by another with no new company being formed. A merger is said to occur when one organization assumes all the assets and liabilities of another organization. In this process of acquisition, the acquiring firm retains its identity, while the acquired firm becomes non-existent with no identity of its own while for a merger to happen a majority vote of shareholders is compulsory. A merger can also be seen as a type of acquisition.
Why Mergers and Acquisitions??
Mergers and acquisitions happen when one firm becomes too weak to carry on its own i.e. the major players dominate the market to such a great extent that small players are just not able to cope up. It may also happen that sometimes organizations realize that their potential, efficiency and profitability will get a boost if they work in collaboration with other organization.
Laws governing Mergers and Acquisitions
State and federal laws have been laid down so as to govern and control the mergers and acquisitions of organizations. State law lays down a path so as to ensure fair practices during a merger or acquisition by establishing judicial oversights, procedures and guidelines for the approval of mergers so on and so forth which has made the merger and acquisition procedures friendly and negotiated transactions.
The HR perspective of Mergers and Acquisitions
Getting to grips with a company merger or acquisition is one of the most challenging issues HR professionals face. Understanding the employment law issues along with critical people issues like leadership, employee communications, talent retention and cultural alignment are very important for success and can contribute to a makeover of the long term merit of the transaction. With the high degree and overseas activity in this complex area and the increasing role of HR in the M&A...