1 - CRO - Contract Research Organization [Seite 1]
1.1 - Index [Seite 3]
1.2 - List of Figures [Seite 5]
1.3 - List of Tables [Seite 6]
1.4 - List of Abbreviations [Seite 7]
1.5 - Introduction [Seite 9]
1.6 - Methodology [Seite 10]
1.7 - 1. Merger & Acquisitions Fundamentals [Seite 11]
1.7.1 - 1.1 Definition and History [Seite 11]
1.7.2 - 1.2 Types and history of Merger & Acquisitions [Seite 12]
1.7.3 - 1.3 Recent M&A Trends [Seite 16]
1.8 - 2. Contract Research Organization Industry [Seite 18]
1.8.1 - 2.1 The Drug Development Process [Seite 18]
1.8.2 - 2.2 Fundamentals of Contract Research Organizations [Seite 21]
1.8.3 - 2.3 Strategic Analysis of the Drug Development Market [Seite 23]
1.8.4 - 2.4 Growth Strategies in CRO Industry [Seite 28]
1.9 - 3. Explanatory Approaches and Motives for M&A [Seite 33]
1.9.1 - 3.1 Strategic Motives [Seite 34]
1.9.2 - 3.2 Financial Motives [Seite 36]
1.9.3 - 3.3 Managerial Motives [Seite 38]
1.10 - 4. Success Factors for the Merger & Acquisitions process [Seite 40]
1.10.1 - 4.1 Merger & Acquisitions Process [Seite 40]
1.10.2 - 4.2 Potential Success Factors during the M&A process [Seite 46]
1.11 - 5. Case Study: Merger & Acquisitions in the CRO industry [Seite 54]
1.11.1 - 5.1 Data & Methodology [Seite 54]
1.11.2 - 5.2 Why M&A occur in the CRO Industry [Seite 55]
1.11.3 - 5.3 Potential Success Factors for the M&A process in the CRO industry [Seite 57]
1.11.4 - 5.4 Reasons for success failures for the M&A process in the CRO industry [Seite 62]
1.11.5 - 5.5 Determinants and evaluation for success after the M&A [Seite 63]
1.12 - 6. Conclusion and Recommendations [Seite 66]
1.13 - Appendix [Seite 69]
1.14 - Bibliography [Seite 81]
Text Sample:
Chapter 3.3, Managerial Motives:
Managerial motives have a more psychological background. They are driven by the Hubris or the Agency-Hypothesis.
3.3.1, Hubris:
Roll presented a study 1980s where he suggested that the hubris is an important motive for corporate takeovers. The interpretation of the empirical results is that manager's pride and an exaggerated opinion of oneself could have a negative effect on the shareholders interests. Pure personal interests and not economic gains motivate the decision makers to undertake the takeovers.
Due to the hubris managers could tend to pay a premium for a company that was correctly valued by the markets (assumption of strongly efficient markets). The hubris model is similar to the winner's curse phenomenon in auctions and the irrational decisions can cause that the acquirer loose money on the acquisition.
3.3.2, Agency Hypothesis:
Georgen and Renneboog outline that takeovers could be motivated by the agency hypothesis. This means that sheer self-interest of the acquirer is the main reason for the offer. Therefore, a conflict between the management (agents) and the shareholders could arise. Managers who are driven by this motive are mainly interested in takeovers that provide them additional power and prestige, whereas shareholders want a higher profitability and participate in higher stock profits. A study has shown that the corporation size is the main determinant for management salaries and bonuses and not the profitability. The difference to the hubris hypothesis is that here the managers will knowingly overpay the transactions to enjoy the mentioned personal advantages. As a result Morck, Shleifer, and Vishny pointed out that the pure self-interest could lead to many unprofitable mergers and acquisitions.
4., Success Factors for the Merger & Acquisitions process:
First of all, this chapter illuminates an ideal Merger & Acquisition process. On that account the process is divided in three main phases. Subsequently, the components of each stage are presented. Afterwards the emphasis lies on the possible success factors of the phases.
4.1, Merger & Acquisitions Process:
Generally, Mergers & Acquisitions are structured as a multilevel process. According to a PWC study a comprehensive structure is important to deal with the complex and multifarious challenges. Moreover, it enables the management to work highly efficient and more goal-oriented. There is no one-size fits all solution but the academic literature tries to develop models, which can be used as instruction. Basically, three main phases can be identified: Planning, Execution (Transaction), and Integration.
The process is not static but rather dynamically and can be adapted to each M&A scenario concerning the company and industry characteristics. Additionally, there can be a lot of another factors (e.g. tax considerations, ownership-structure), which can have an influence on the configuration of the process.
