International Journal of Transformations in Business Management

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Abstract

Impacts of Mergers and Acquisitions on Company Performance: Evidence from Nigeria

P. O Yabugbe

Department Of Banking and Finance Adekunle Ajasin University Akungba- Akoko, Ondo State, Nigeria.

Professor J.B. Longe

Department Of Economics, Adekunle Ajasin University Akungba- Akoko, Ondo State, Nigeria.

40-50 Vol: 3, Issue: 3, 2013
Receiving Date: 2013-05-21
Acceptance Date: 2013-06-22
Publication Date: 2013-07-21
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Abstract

The history of Nigerian companies is replete with instances where companies have collapsed for reasons of inadequate
capital base, ineffective management, operational inefficiency, low return on investment, fraud by top management,
and low plant utilization. Today, organizations endeavour to find solutions to these problems by adopting survival
strategies which predominantly involve mergers and acquisitions. It is necessary in the circumstance to find out the
situation with Nigerian companies. The objective of this research is to examine the impact of mergers and acquisitions
(M&As) on company performance in Nigeria. In carrying out this study, the merger of Total Nigeria Plc and ELF Oil
Marketing Nigeria Ltd was selected as case study. The methodology adopted was using Altmans Z score model to
affirm whether or not the strategy added value to the organizations. The finding of this study was that mergers and
acquisitions tremendously improved the overall performances of the companies. The study concluded that mergers
and acquisitions are appropriate and cheap platforms to grow companies and ensure their survival provided that
the companies are in the same or related business.

Keywords: Mergers; Acquisitions; Performance; Impact

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