Alliances Usually Go Wrong If

question 22

Multiple Choice

Alliances usually go wrong if

• A)firms squabble over the contributions and returns from the alliance.
• B)each firm really wants to acquire the other's core capabilities.
• C)the firms are customer and supplier.
• D)either a or b.

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Definitions:

Separate Values

Separate Values pertains to distinctly evaluating different assets, liabilities, or components for financial, analytical, or assessment purposes.

Synergies

The additional value created by combining two or more companies or assets, expected to lead to greater efficiency or profitability.

NPV

Net Present Value; a method used in capital budgeting to evaluate the profitability of an investment or project by calculating the difference between the present value of cash inflows and outflows.

Pre-Merger Market

The financial and economic conditions affecting companies and their stock prices before they undergo a merger.