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QUESTION
Week 6 Discussion
Using the company of your choice, provide an example where the company used one of the seven common Winning Moves identified in this week’s lecture notes to expand their business.
- Why do you presume they elected to use this Move?
- What were some of the most significant challenges they faced?
- What could they have done to better overcome these challenges?
The company of my choice is Nissan Motor Corporation.
https://blackboard.strayer.edu/bbcswebdav/pid-33496894-dt-content-rid-147390663_4/institution/JWMI/540/Lecture%20PDF/1192/JWI_540_W6_1192.pdf
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| Subject |
Business |
Pages |
2 |
Style |
APA |
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Answer
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Nissan Acquires Mitsubishi
Nissan Motor Corporation has implemented acquisition, one of the seven common winning moves. According to Yaghoubi et al. (2016), acquisition refers to the act of another company purchasing the shares of another company to gain a controlling stake in the acquired company. Nissan applied the strategy by acquiring a controlling stake in Mitsubishi. The company adopted the move because of the following reasons; first, it wanted to eliminate meaningless competition as both companies are from Japan. Secondly, to enjoy economies of scale as both companies are in the same line of business. Therefore, acquiring Mitsubishi will enable the company to benefit from the economy of scale, thus reducing production costs.
As Uhlenbruck et al. (2017) assert, acquisitions often face significant logistical challenges in the market. The challenges often stem from sources such as the government as they often view acquisition to eliminate competition and, therefore, disadvantage the customers. Nissan faced the same challenges as its deal to acquire Mitsubishi was scrutinized to determine if there is reason to worry about the move disadvantaging consumers in Japan and around the world. Therefore, the acquisition was delayed as various anti-trust agencies in both Japan and Europe looked at the deal to ascertain it posed no threat to healthy competition in the market.
According to Elhauge (2020), anti-trust laws are the main stumbling block when it comes to acquisitions around the world. Nissan could have avoided the challenge in the following ways. First, reading anti-trust laws in both Japan and Europe to ensure that the move does not breach any part of the laws. Secondly, it should have presented its findings to the investigating authorities to reduce the amount of time they took analyzing the deal before giving it the green light to continue.
References
Elhauge, E. (2020). How Horizontal Shareholding Harms Our Economy-And Why Antitrust Law Can Fix It. Harv. Bus. L. Rev., 10, 207.
Uhlenbruck, K., Hughes-Morgan, M., Hitt, M. A., Ferrier, W. J., & Brymer, R. (2017). Rivals’ reactions to mergers and acquisitions. Strategic Organization, 15(1), 40-66.
Yaghoubi, R., Yaghoubi, M., Locke, S., & Gibb, J. (2016). Mergers and acquisitions: a review (part 2). Studies in Economics and Finance.
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