Long Trem Investment

Assume that the company’s is considering a merger. The possible merger currently faces some threats and that the industry decides on self-expansion as an alternative strategy, describe the additional complexities that would arise under this new scenario of expansion via capital projects.

Typical mergers consist of one large company attempting to buy a smaller well-established consumer based company. Mergers do not typically take place with two large companies, because of the issues that could arise. The purpose of a merger is to establish the company in areas where their footprint is lacking and to establish more customer relationships. If Bank of America were to merge with Regions Bank, the process would be possible success. The possible relationship would spread across the Sun Belt and would establish new banking relationships through account conversions. Bank of America being the larger entity would therefore enforce their policy procedures on Regions. The account conversions would slowly take into effect at all banking centers, giving customers and employees time to adjust to the new changes. Other large corporations would retaliate by trying to expand through mergers as well. “The U.S. Department of Justice gave Sprint a reprieve by filing suit in the District of Columbia, seeking an injunction against the merger on the ground that it was anti-competitive and violated federal antitrust law. On Sept. 6, Sprint filed its own antitrust lawsuit in federal court seeking to block the merger. The Federal Communications Commission, which also must approve the deal, has expressed some concern over the merger, but has to make a final determination on whether to allow the transfer of wireless licenses required by the deal. While AT&T can fight the lawsuits in court, it looks like the legal damage is fatal. However, perhaps another deal could be forged from the ruins of this one. The way it looks right now, the market would be well served if Sprint and T-Mobile combine...