Location:Home > Mergers & Acquistions in China > Disadvantages of Mergers and Acquisitions in China
Disadvantages of Mergers and Acquisitions in China
Information provider:zanya consultants    Updated:2016/10/25    Website:www.companyformation86.com

The disadvantages of mergers and acquisitions are as following:


(1) Diseconomies of scale if business becomes too large, which leads to higher unit costs.


(2) M & A is within the scope of the Board of Directors to pursue and the company executives to initiate and execute. Since board members may also be subject to political, social, and personal interests, decisions seemingly in favor of the shareholders may also become quagmired with additional factors.


(3) Clashes of culture between different types of businesses can occur, reducing the effectiveness of the integration.


(4) Bad management and overestimating the valuation of the acquired corporation.

(5) May need to make some workers redundant, especially at management levels - this may have an effect on motivation.

(6) May be a conflict of objectives between different businesses, meaning decisions are more difficult to make and causing disruption in the running of the business.


(7) Failure to consider and/or incorporate the new company


For further information or assistance, please feel free to contact us


Tel: (86.20);37887606           Mobile: 13928789801 (You can inquire in English)

Fax: (86.20); 37887609         E-mail:2291837655@qq.com

Wechat:563491716             Skype: zanyaco                  

QQ: 1502027480                Website: http://www. companyformation86.com

Address: Room 1001, No.621, Tianhe Road, Tianhe District, Guangzhou, China

Zanya Consultants

Tel: (86 20) 37887606

Mobile: (86) 13928789801



Email: 2291837655@qq.com

Add:Rm1703, KB.Digital Plaza,Shi p

ai xi Rd,No.8,Tianhe District,GZ



China Office Tel: +86(20)37887606    Fax: +86(20)37887609      Wechat:563491716
Website:www.companyformation86.com      Email:2291837655@qq.com
All Rights Reserved © Zanya Int’L Consulting Limited