Question

Q 53. Write the three main difference between merger and joint ventures.

Examples in real life of both (any one)

(Min words 85)



No spam only explanation.

Answer 1

ANSWER IS AS FOLLOWS :
$Every \:company \:aims\: to\: earn \:profit.\\ Now,\: the \:best\: way\: to \:earn \:higher \:profit \:is\: expansion. \\Companies \:can \:expand \:their \:business \:in \:many\: ways. \\Out \:of \:which\:, two \:main \:are\colon$
$\underline{Merger}$$\texttt{and}$$\underline{Joint \: Ventures. }$
THE DIFFERNCE BETWEEN THEM ARE :
$\underline{Merger :}$
Basis : Description
$\underline{Structure:}$ $Two\: or\: more \:companies \:combine\: together\: to \:share\: its \\ resources\: and \:profits.\: They \:form\: a \:complete \: \\company \:with \:a\: new \:name, \:company, \:style\:and \:resources. \\Original \:companies \:don't \:exist \:anymore.$

$\underline{Ownership:}$ $The\: owners \:of\: the\: newly\: formed\: company\: are\: the \\same \:as\: the\: owners\: of \:the \:original \:two \:companies.$

$\underline{Scope:}$ $A\: merger \:is\: useful\: when \:two \:businesses \:wish \:to \:become \\fully\: integrated -- that \:is, \:when\: two \:firms\: have \\enough \:overlap\: that \:they \:can\: perform\\ most \:of\: their \:business\: together.$

$\underline{Example:}$ $vijya\: + \: baroda\: + \: bank \: = \: baroda$

$\underline{Joint \: Venture :}$
Basis : Description
$\underline{Structure:}$ $A \:new\: separate \:firm \:is\: formed, \:but \:the \:original \:companies\\continue\: to \:exist\: on\: their\: own.$

$\underline{Ownership:}$$When \:a \:joint\: venture \:is \:created,\: it\: is \:owned \:\\by \:the\: original\: firms \:that \:created \:it. \:The \:two\: mother \\companies\:maintained \:ownership \:of\: the \:new \\entity.$

$\underline{Scope:}$$A\: joint\: venture \: focuses \:on \:a \:specific\: area \:where \\two\: firms\: overlap \:and \:can \:work\: together, \:but \:the \:bulk \:of \\their \:remains\:separate.$

$\underline{Example:}$$\textit{Axis Bank Freechange}$

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