According to the company the merger of RPL which incidentally just started operating over a month ago with RIL is to build scale and benefit from operation synergies. To see your saved stories, click on link hightlighted in bold. Skip to main content. The data of just preceding years of the year the merger took place has been considered for pre-merger study and the data for the year has been used for post merger study. The present study is an attempt to find out the difference in post merger financial performance compared with pre merger in terms of profitability and generating more value than the separate firms, resulting in consolidation, refocusing and restructuring of the industry with a motive of faster mechanism.

Due to the existence of strict government regulations, Indian companies were forced to go to new areas where capabilities are difficult to develop in the short run. The earnings multiple of an integrated energy company are far greater than that of a single energy company Mukesh Ambani has yet again followed a strategy that Reliance Group has been using for the last three decades. The merger is with retrospective effect from April 1, After merging RPL in to it in this ratio was increased to Not all shareholders waited for the announcement.

The following hypotheses have been formulated and tested to draw the conclusions: Companies intensely working in competitive business environment have to change fast as per the evolving dynamics in their industry of operation.

History repeats with RIL-RPL merger

After merger this ratio was declined to 9. Find this comment offensive?


ril and rpl case study

Chevron no longer required large quantities of the product in its system. USD Period of Study: Generally, the company that survives is the buyer which retains its identity and the seller company is extinguished.

RIL, RPL merger swap ratio set at 1:16, Chevron sells RPL stake

Mergers and Acquisitions is considered as one of the strategies for growth which have emerged as a natural process of business restructuring throughout the world. The Thomson Reuters Trust Principles. The following 4 major financial ratios and their means were calculated for analyzing the financial performance of the companies: The rating affirmation reflects the neutral impact of the transaction on the consolidated financial profile of the group, as the consideration will be paid primarily through issuance of shares.

The response from the market was overwhelming and the issue was oversubscribed by over 50 times. RPL, then went public late that year to raise funds with a public issue of Rs crore, making it among the largest for the time.

According to the company the merger of RPL which incidentally just started operating over a month ago with RIL is to build scale and benefit from operation synergies.

This will alert our moderators to take action Name Reason for reporting: This was to create an export-oriented refinery at Jamnagar. Synergetic advantage of strategic Mergers and Acquisitions. Written by Corporate Bureau Mumbai Updated: Usually, one company will buy another and, as part of the stury terms, simply allow the acquired firm to proclaim that the action is a merger of equals, even if it is technically an acquisition.


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The declining interest coverage ratio of the acquirer company RIL from Officials said there are no issues or complications here but is a mere formality of RIL and RPL following the procedures. Issn no volume 11 “Mergers and Acquisitions: Importance of the study: Help Center Find new research papers in: The above Table shows the position of Reliance Industries Ltd.

In pursuit of this growth strategy, they often change their organization and basic operating characteristics to meet the diversified businesses and management. There is no considerable difference between pre and post merger financial performance. With the merger ratio pegged at 1: RIL will issue 6.

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Click here to sign up. Your Reason has fil Reported to the admin. This clearly indicates that the Company has realized some losses of the target company which might be due to the costs incurred during the merger period or so. No fresh investment is made through this process. Not all shareholders waited for the announcement.

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ril and rpl case study