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    MACR (2nd) May2022

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    Jagjit Gill
    This document is a 17 question exam on mergers, acquisitions, and corporate restructuring for an MBA program. It contains short answer and long answer questions across 4 sections. The final question is a case study on Tata's acquisition of Corus for $12 billion in 2007, financed through $8 billion in loans. Students are asked to identify the merger strategy, explain the financial structure, and reasons for Corus accepting the deal.

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    MACR (2nd) May2022

    Uploaded by

    Jagjit Gill
    35 views3 pages
    This document is a 17 question exam on mergers, acquisitions, and corporate restructuring for an MBA program. It contains short answer and long answer questions across 4 sections. The final question is a case study on Tata's acquisition of Corus for $12 billion in 2007, financed through $8 billion in loans. Students are asked to identify the merger strategy, explain the financial structure, and reasons for Corus accepting the deal.

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    MACR(2nd)May2022

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    This document is a 17 question exam on mergers, acquisitions, and corporate restructuring for an MBA program. It contains short answer and long answer questions across 4 sections. The final question is a case study on Tata's acquisition of Corus for $12 billion in 2007, financed through $8 billion in loans. Students are asked to identify the merger strategy, explain the financial structure, and reasons for Corus accepting the deal.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    35 views3 pages

    MACR (2nd) May2022

    Uploaded by

    Jagjit Gill
    This document is a 17 question exam on mergers, acquisitions, and corporate restructuring for an MBA program. It contains short answer and long answer questions across 4 sections. The final question is a case study on Tata's acquisition of Corus for $12 billion in 2007, financed through $8 billion in loans. Students are asked to identify the merger strategy, explain the financial structure, and reasons for Corus accepting the deal.

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    You are on page 1of 3

    Roll No. Total No.

    of Pages : 03
    Total No. of Questions : 17

    MBA (Sem.–4)
    MERGERS, ACQUISITIONS AND CORPORATE
    RESTRUCTURING
    Subject Code :MBA-914-18
    M.Code :77813
    Date of Examination : 08-07-22
    Time : 3 Hrs. Max. Marks : 60

    INSTRUCTIONS TO CANDIDATES :
    1.
    m
    SECTION-A contains EIGHT questions carrying T WO marks each and students
    have to attempt ALL questions.
    o
    .r c
    2. SECTION-B consists of FOUR Subsections : Units-I, II, III & IV. Each Subsection
    contains T WO questions each carrying EIGHT marks each and students have to

    3.

    om
    attempt any ONE question from each Subsection.

    e
    SECTION-C is COMPULSORY consists of ONEQuestion carrying T WELVE marks.

    .r c ap
    p e
    SECTION-A

    r p
    Write short notes on :

    a b
    1.
    p
    Define merger.

    r
    2.

    3.
    b
    What is synergy?

    What is share repurchase?

    4. Explain horizontal merger.

    5. What is Demerger?

    6. What is takeover bid?

    7. What is value creation?

    8. What do you mean by share exchange ratio?

    1 | M-77813 (S32)-778
    SECTION-B

    UNIT-I

    9. Explain the term corporate restructuring. Discuss different forms of corporate


    restructuring.

    10. What is Takeover? Discuss various takeover defense strategies.

    UNIT-II

    11. Write Short notes on following:

    a. Revere Merger

    b. Strategic Alliance

    o m
    structure.
    m .r c
    12. Explain the concept of Leveraged Buy-Out (LBO). Also, discuss its characteristics and

    o p e
    .r c
    UNIT-III

    13. Write short notes on following:


    e p a
    p
    a. Accounting aspects of mergers and acquisitions.
    b r
    p a
    r
    b. Impact of payment option on EPS.

    b
    14. Discuss various financing options available to acquiring company.

    UNIT-IV

    15. Explain the motives behind International mergers and acquisitions. Discuss reasons for
    failure of international mergers and acquisitions.

    16. Write short notes on following:

    a. Taxation aspects of mergers and acquisitions.

    b. Due diligence in mergers and acquisitions.

    2 | M-77813 (S32)-778
    SECTION-C

    17. Case Study:

    Tata acquired Corus on the 2nd of April 2007 for a price of$12billion making the Indian
    company the world’s fifth largest steel producer. Tata has reportedly financed only $4
    billion of the Corus purchase from internal company resources, meaning that more than
    two-thirds of the deal has had to be financed through loans from major banks. Tata’s new
    debt amounting to $8 billion due to the acquisition, financed with Corus’ cash flows, is
    expected to generate up to $640 million in annual interest charges (The day after the
    acquisition was officially announced, Tata Steel’s share fell by 10.7 percent on the
    Bombay stock market.)

    The acquisition by Tata amounted to a total of 608 pence per ordinary share of £6.2
    billion (US $12 billion) which was paid in cash. First of all, the general assumption is that

    o m
    the acquisition was not cheap for Tata. The price that they paid represents a very high
    49% premium over the closing mid market share price of Corus on 4 October’ 2006 and a

    .r c
    premium of over 68% over the average closing market share price overthe twelve-month
    period. Moreover, since the deal was paid for in cash automatically makes it more
    m e
    expensive, implying a cash outflow from Tata Steel in the amount of £1.84 billion.

    o
    .r c p
    The debate whether Tata Steel has overpaid for acquiring Corus is most likely to be
    a
    certain, since just based on the numbers alone it turns out that at the end of thebidding

    e r p
    conflict with CSN, Tata ended up paying approximately 68% above the average price of
    Corusshares.
    p
    a b
    p
    Answer the following questions:

    r
    b
    a) Identify the merger strategy used in Tata-Corus deal. Explain its features.

    b) Explain the financial structure of the Tata-Corus deal.

    c) As per your understanding, why did Corus went for this deal?

    NOTE : Disclosure of Identity by writing Mobile No. or Making of passing request on any
    page of Answer Sheet will lead to UMC against the Student.

    3 | M-77813 (S32)-778

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