The recent research by Paul Mampilly shows that there are a lot of opportunities for organizations to make supernormal profits through the adoption of the mergers and acquisitions. This is a concept that many organizations have ignored, yet it is one of the breakthrough opportunities for their success. Paul Mampilly submits that by companies forming M&As, there are a lot of benefits that they are likely to reap from each other. One of the benefits that he highlights is the leverage on the customer base of each organization in the merger. Whenever companies merge, or one company purchases the other, the result is that both the parties start enjoying the goodwill of each other and consequently increasing their market base.
On the other hand, the companies involved in the acquisition process benefit from increased revenues. This is a result of the diversification of the areas of investments and hence the reduction of the investment risk. For instance, whenever a company operating in the banking industry merges with another from the transport industry, they manage to enjoy investment options from different the various economic sectors and hence in case of poor performance in one industry, the investment returns would not be adversely affected since the organizations invest in a variety of sectors in the industry.
Paul Mampilly is also categorical in his submission about the management and of the mergers and acquisitions. He says that this is a daunting task and if not well managed, the idea can lead to very detrimental effects to one of the companies or both. However, he states that the most important thing is the dispensation of leadership in the mergers. Whenever the companies merge, the leadership of the organizations is likely to be affected, and if the transfer of this leadership is not handled correctly, it can cause some operational hiccups for the merger.
In his advice, Paul Mampilly recommends that for a merger and acquisition to be successful, it’s always advisable that the leadership of the acquired organization remain intact while the company operates under the umbrella of the acquirer. This would ensure that the production of the company is not interrupted.