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f) Conglomeration is a merger where the concerned companies have nothing in common to sell.

There are various reasons behind merger of companies. In such a situation this company can merge with one its parent company or any other company that has faith in the prior goodwill of the declining company and in its potential to grow and enhance. So companies also merge in order to overcome their internal inconsistencies.

d) Many a mergers besides economically are also politically driven.

e) Acquisitions which imply taking over of one stronger company with the other weaker one are also at times veiled by the name of merger.

However, the directors who plan to merge their companies should actually contemplate over it, keeping in mind all the possible pros and cons.

The economy today is not stabilized. Even big companies have to confront the ups and downs that come their way. But the only thing that keeps them going is survival. They have to survive in the market and progress swiftly or gradually. One strategy to way is that of ‘mergers’ mid companies. There are numerous mergers that take place locally but they do not have a great effect on the market especially the consumers. But the mergers that take place at the national or international level have a profound impact on the economies of the concerned countries.

There are different reasons infra a merger of two or more companies. But first of all there exist diverse types of mergers.

a) Horizontal Mergers- where two competing companies conjoin to form a single large company. The companies in horizontal mergers are selling the same product in the same market and so are contenders to each other. Such a merger can have a tremendous influence on the market from creating monopoly to escalating prices of the commodity. This is precisely the reason that The operative Trade.

b) Commission that is worried pertinent to the market and the consumers keeps a hawk’s eye on such mergers and at times detains the companies from merging in the interest of the people.

c) The Vertical Mergers- are the mergers among a supplier and the distributor second team of the supplies. This is an anti competitive merger but can be highly pragmatical to the company. It is whereas the distributor will no more have to pay for the manufacturing of the supplies, it gets the product at the base price. So there is good cost saving due to this. Vertical merger also rules out lot of competition from the market.

d) Market Extension Merger is mid the companies selling same product but in different markets. This merger enhances the market for the two companies since they now act as one sole company.

e) Product Extension Merger is like the one mid an eminent convention making motor parts and ulterior that makes their own cars. So, the companies involved here sell different but more or less the same product in the same market. This merger promotes the sale of both the companies significantly.

f) Conglomeration is a merger where the concerned companies have nothing in defiled to sell.

There are various reasons afterwards merger of companies. Like

a) Synergy factor prompts the merger of most of the companies. The synergy in establishment pertains to the cost saving and revenue enhancement. The companies younger merger decrease the staff keeping only the skilled labor, work with a single managing director, CEO etc. So there is good outlay saving. Moreover the economy of the sale i.e. the purchasing power of the uninvited guest booms in lock-step with merger.

b) To increase the output and rule the market- many mergers are made with the intention to oust the competition and jointly rule the market. This presupposes healthy relations betwixt and between the competing companies.

c) Mergers also take place when a partaking is not able to perform well due to some or the other guiding light like the lack of required investment in the form of capital, tremendous competition etc. In such a situation this party can merge with one its parent association or any other corporation that has faith in the prior goodwill of the declining cooperation and in its potential to grow and enhance. So companies also merge in order to overcome their internal inconsistencies.

d) Many a mergers together with economically are also politically driven.

e) Acquisitions which imply taking over of one stronger concern with the other weaker one are also at times veiled by the name of merger.

However, the directors who plan to merge their companies should factually contemplate over it, keeping in mind all the possible pros and cons. They must seek tip-off from neutral financial consultants who do are more inclined towards the welfare of the playmate and not their own. Their own benediction is also hidden in a merger since the wages of the employees increase with the expansion due to merger. So it is recommended to take intelligence from all those who are the well wishers of the playmate taking any concrete step in this direction.

It’s been about 6 months since I bought a basket of 5 Japanese net-nets.

A couple people have asked about how my Japanese net-nets have done. I started making these investments around April of this year. I wrote the “Buy Japan” post before buying my 5 Japanese net-nets. And it took me about a month of bidding for these micro caps to get my orders filled.

Since then, in dollar terms, the 5 stocks are up: 6.41%, 7.53%, 12.80%, 18.35%, and 20.88%.

You can use the March 16^th date of my “Buy Japan” post as a convenient way of measuring the influence the Japanese Yen / U.S. Dollar exchange rate has had on the performance of those stocks. For Japanese investors, your results would obviously not include these Dollar exchange rate changes.

Let’s just say these Japanese net-nets have done better than my U.S. net-nets this year. It doesn’t matter if you are calculating returns in local currency or dollars. My Japanese net-nets have been my best performers this year.

I will re-evaluate the positions around June of next year.

I generally hold net-nets for at least a year before considering whether they should be sold. This gives them time to run.

Most people sell net-nets too fast because they dislike the underlying businesses and are not used to having such large gains in a single year.

Of course, the truth is that a net-net that rises 50% or even 100% is usually still a very cheap stock. So it’s silly to sell a net-net just because it’s gone up.

Talk to Geoff About His Japanese Net-Nets

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