The Integration of Financial Information Industry under M&A Trend:A Case Study of TR Merger

• Main Authors: Ting-Ting Sheu, 許亭亭
• Other Authors: 郭瑞祥
• Format: Others
• Language: en_US
• Published: 2011
• Online Access: http://ndltd.ncl.edu.tw/handle/20715902354814311033

碩士 === 國立臺灣大學 === 商學組 === 99 === Mergers and acquisitions (M&A) and corporate restructuring are a big part of the corporate finance world. When strategic and operational drivers are compelling enough, companies buy other companies in order to enhance their positioning in the competitive landscape, capture growth and realize synergies. If a merger goes well, the new company should appreciate in value as investors anticipate synergies to be actualized, creating cost savings and/or increased revenue for the new entity. However, time and again, executives face major stumbling blocks after the deal is consummated. Cultural clashes and turf wars can prevent post-integration plans from being properly executed. M&A has such a bad track record that it will be a lucky minority who can create and sustain value from their deals. A McKinsey study found that 70% of mergers fail to produce expected gains in revenues. Despite the high failure rate, companies in financial information industry seem obsessive to the M&A game and continuously eat and be eaten. Take Company R as an example, it acquired its 2nd largest rival, Company B in 2001, and bought Company M in 2005, but was acquired by Company T in 2008. The purpose of this research is to conduct a case study in analyzing the TR merger in 2008 by accessing SDC database for industry M&A deals in past 30 years to view the M&A trend in the financial information industry; accessing to RK database for competitor analysis; and i-banks’ research reports for the 2008 TR merger details; then, backing up with M&A theories to review the outcomes of this merger. This research found that TR merger is a win-win case as most of results show positive signs no matter from efficiency aspect (with cost saving, and higher financial margin), market power aspect (gain back market leader position which lost in 2003), EPS game (improved EPS figures), and diversification aspect (truly global presence and no longer tight up with stock market cycle as the other Division supports half of the merged company’s earnings).