Locate a publicly traded company in an industry that interests you. Find a publicly traded competitor which is suitable for a merger or acquisition with this firm.
write a 3 page paper about the work and make a ppt for the work. My part is part 4. The
Requirements: 3p+4-5p
Group Research Project & Presentation
Your written assignment is as follows:
1. Locate a publicly traded company in an industry that interests you. Find a publicly traded competitor which is suitable for a merger or acquisition with this firm.
2. Write a ten page double spaced paper (not including exhibits) on why the company should be acquired and what purchase price should be paid. In addition to a hard copy, a copy of your paper on disk is required. The disk label should include your topic and all members of your group. Your analysis should include the “real” reasons behind the merger and not the standard answers. Major topics should include: A brief background of the industry which the company operates, a background on the company and the management team, the acquisition purchase price (you may want to include a base purchase price and the maximum purchase price your firm would be willing to pay), what makes this merger a good fit, a brief strategy on how the company will operate after the merger, and how the deal would be financed.
3. You have an enormous amount of material to use for this project. Annual Reports and 10Ks can be obtained by contacting the company’s Investor Services Department.
4. Prepare your presentation as though it was before the Board of Directors of the company. The class will be asking specific questions about your analysis, so be prepared.
5. Group participation by each member is critical to the success of the group. Therefore, each group member will evaluate each of the other members. I will provide each member with an evaluation form.
Two of the major evaluation criteria for the paper are:
1) How well do you apply the financial concepts and analysis for your proposed acquisition.
2) The quality and originality of the recommendations (and how well they tie to your analysis) of the company.
3) The quality of your twenty minute presentation with two analytical questions from the class.
The paper must follow APA Format. The maximum length of the paper is 15 double spaced pages, excluding references and abstract. You may attach as many pages as appendixes of data, tables, etc. as you need. A financial model with a discounted cash flow valuation is required and should be included in the paper to support your analysis.
Tencent wants to rely on acquiring Bilibili to get some synergies. It wants to create long-term value by integrating resources after the merger and acquisition, so it should be considered a strategic buyer. First of all, both companies are very well known in China’s Internet sector, with some of Tencent’s business overlapping with Bilibili’s main business. They both provide online video services, and both invest in the entertainment industry. It can be said that they are in the same industry has a certain competitive relationship, but the same they are also in different business complementary, such as Bilibili more focus on supporting the development of original creators, live and secondary animation industry, etc., and Tencent in this aspect of the occupation of the market share and loyal users is relatively low, mergers and acquisitions can let Tencent expand their business scope, to achieve the effect of 1 + 1 > 2.
The completion of the merger and acquisition of the two will produce synergistic effects, firstly, the two can complete the integration of business and resource sharing. Bilibili has a certain uniqueness in China’s Internet market, which is mainly positioned in the secondary culture, and has a very large number of anime, games, and other secondary culture user groups. Bilibili owns the broadcasting rights to many foreign cartoons in China, and it is also a good promotion platform for some secondary games. At the same time, it also encourages and supports original creators to publish their video content as a business point, and many users will make long videos to get attention and attract fans. It is very similar to the foreign YOUTUBE platform, but in China, this kind of platform is rare. While Tencent has rich film and game resources, it also has the need to expand young users and the secondary yuan-related market, and if it completes the merger and acquisition with Bilibili, it can expand its market share and improve its competitiveness. The integration of resources between the two can greatly improve the vitality of their respective businesses, Tencent can use this to promote its games, but also can provide creators with more material and resources to enhance the vitality of creators and the degree of user motivation. At the same time, they could also work together to launch a game with a more innovative anime style and setting; Bilibili has a lot of data to analyze the aesthetics and preferences of today’s younger generation of users, and Tencent has a good team of game creators and technologists, so launching a major game and an IP could be a big win for both of them. While completing the integration of resources, departments can be optimized and reorganized, and streamlined in the part of the business overlap to reduce costs.
Secondly, the merger of the two facilitates the interoperability of user traffic. They already have a very large user base, but there are overlapping parts and parts that focus only on their respective main business. Through the integration of resources can effectively improve user stickiness, as mentioned in the previous section, can be the integration of their main business, cross-drainage, if the effect is good, you can realize the whole field to occupy market share. At the same time, with the help of some of their respective IP co-branding series of offline activities or peripheral products, you can also reap more profits. Another business that Bilibili is doing well in is the live-streaming industry, and commissions collected from live-streaming gifts make up a large portion of its revenue. Also, many of the contracted anchors have a lot of loyal users, but due to copyright issues, Bilibili’s anchors are prohibited from broadcasting certain content, which can lead to a diversion of users. The merger with Tencent will allow them to have more content to broadcast to attract specific viewers, as well as drive traffic to their respective platforms’ homepages to increase reach and user stickiness.
In addition, due to Bilibili’s development problems, he needs sufficient financial support to maintain operations. Tencent, as the leading company in China’s Internet industry, has a strong technical R&D team, an operation team, as well as sufficient funds and resources. Tencent can help Bilibili to re-plan its future operation mode, and even re-organize its team to plan its future path. Bilibili is currently in a revenue loss crisis, and competition in the industry has led to higher and higher costs of acquiring subscribers, making it even more difficult for it to retain paying subscribers. At the same time, it wants to rely on the development of games to obtain a certain amount of profit, but due to the lack of talent, lack of project management capabilities, unclear positioning, etc., it cannot stand out in the crowd of game companies. That’s why, as mentioned earlier, Tencent’s production team and technical team can help Bilibili complete a certain transformation in this regard.
Summary of The Strategic Merger and Acquisition of Tencent and Bilibili
This paper begins firstly with an introduction that outlines the seismic shift in the digital industry landscape set to be caused by the proposed merger and acquisition of Tencent and Bilibili. This section provides a brief background of both Tencent, a colossal in the technology industry, and Bilibili, a niche leader in the animation, comic, and game (ACG) industry, to set the context for the merger.
Then we will discuss the acquisition price. The base purchase price has been set at an impressive xxx dollars, reflecting the significant value and potential Bilibili brings to the table. However, contingent on specific performance metrics and growth objectives being met, the maximum purchase price could escalate to xxx dollars.
Next, another part of the paper delves into the compatibility of Tencent and Bilibili and why this merger makes perfect strategic sense. The complementarity of both companies – Tencent’s vast resources and global footprint, Bilibili’s robust user base and specialized content creation – makes this an auspicious match.
Lastly,Our team group will outlines the strategy post-merger. Tencent will likely retain Bilibili’s brand identity, and integrate it into its diverse ecosystem to stimulate synergies. Bilibili’s content-driven platform can be utilized to enhance Tencent’s content offerings, especially in the ACG segment, while Tencent’s technology and capital could drive Bilibili’s expansion into newer markets and product segments. What’s more, the financing of this deal, will likely be financed through a combination of Tencent’s cash reserves, debt issuance, and possibly, equity financing. The strategic nature of this deal should make it attractive to a range of investors and lenders, setting the stage for a successful conclusion.
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