Mergers, takeovers and sell-offs

Stakes and joint ventures

Expressions
a stake an interest a holding	in a company	the share that one investor has in a compnay
a majority	stake interest holding	when more than 50 percent of the shares of a company are owned by one investor, giving them control over how it is run
a minority	stake interest holding	when an investor owns less than 50 percent of the shares of a company

Two compnies may work together in a particular area by forming an alliance or joint venture; they may remain separate companies, or form a new company in which they both have a stake.

Words

alliance /əˈlaɪəns/ ★☆☆ n.

[countable] an arrangement in which two or more contries, groups etc agree to work together to try to change or achieve something

Britain’s millitary alliance with her NATO partners.

joint venture n.

a business activity in which two or more companies have invested together

Saudi Arabian and Japanese officials agreed on a joint venture to build oil refineries in both countries.

Mergers and takeovers

General Oil and PP have announced they are going to merge. It will be the biggest ever merge in the oil industry

Blighty Telecom is to split into two, and demerge its fixe-line and mobile businesses as part of on-going restructuring. The aim of the demerger is to cut debt by £10 billion.

Climents de France, the French building group, is to acquire Red Square Industries of the UK for 3.1 billion euros. This is a friendly bid, as RSI are likely to welcome it and agree to it. But the takeover comes only a year after RSI rejected a hostile bid, an unwanted one.

Abbot Bank is doing badly, and may become the victim of a predator. There were rumours of a possible takeover by Bullion, but it says it won’t play the white knight for Abbot by coming to its defence. This leaves Abbot exposed to acquisition, and it may be prey to a bing international bank. Abbot does have a posion pill however, in the form of a special class of shares that will be very expensivve for a predator to buy.

Words

merger /ˈmɜːdʒə $ ˈmɜːrdʒər/ ★☆☆ n.

[countable] the joining together of two or more companies or organizations to form one larger one

There has been a lot of talk about a merger with another leading bank.

hostile /ˈhɒstaɪl $ ˈhɑːstl, ˈhɑːstaɪl/ ★☆☆ adj.

angry and deliberately unfriendly towards someone, and read to argue with them

Southampton fans gave their former coach a hostile reception.

belonging to an enemy

hostile territory

bid /bɪd/ ★★☆ W3 n

[countable] an offer to pay a particular price for something, especially at an auction

They put in a bid for the house.

an offer to do work or provide services for a specific price

rival bids for the cleaning contract

predator /ˈpredətə $ -ər/ ★☆☆ n.

[countable] an animal that kills and eats other animals

someone who tries to use another person’s weakness toget advantages

a sexual predator

prey /preɪ/ n.

[singular, uncountable] an animal, bird etc that is hunted and eaten by another animal OPP predator

a tiger stalking its prey

Conglomerates

1985

Low-price general retail Cotton Stores acquires Bestco supermarkets and diversifies into food retailing

1990s

Cotton makes a series of acquisitions of retail and non-retail businesses, and becomes the parent company in a conglomerate or combine, with the other businesses as its subsidiaries.

2000

Shareholders complain that Cotton Group is unfocused. They demand that its CEO should depose of non-retail companies, which they describe as non-core assets, and reinvest the money in its main, core-activity: retailing. They say that this dinvestment and restructuring is necessary for future growth and profitability.

Words

diversify /daɪˈvɜːsɪfaɪ $ dəˈvɜːr-, daɪ-/ ★☆☆ vi, vt.

if a business, company, country etc diversifies, it increases the range of goods or services it produces

The company is planning to diversify into other mining activities.

conglomerate /kənˈɡlɒmərət $ -ˈɡlɑː-/ n.

[countable] a large business organization consisting of several different companies that have joined together

an international conglomerate

dispose /dɪˈspəʊz $ -ˈspoʊz/ ★☆☆ v.

to arrange things or put them in their place

Chinese vases are disposed around the gallery.

dispose of something phvt.

to get rid of something that is no longer needed or wanted

We charge customers as little as DM50 to dispose of an old computer terminal.

to sell an asset

Most of those properties will be disposed of over the next five years.

divestment /daɪˈvestmənt/ n.

[countable, uncountable] another word for disinvestment

disinvestment /ˌdɪsənˈvestmənt/ n.

[countable, uncountable] the process of taking your money out of a company by selling your shares in it OPP investment

Federal disinvestment posed a serious dilemma for distressed cities.

It is the end of this time : )