Vertical or horizontal?

This topic contains 4 replies, has 5 voices, and was last updated by  Gabriele Frigerio 11 months, 3 weeks ago.

Viewing 5 posts - 1 through 5 (of 5 total)
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  • #75449

    Seun Yakub
    Participant

    Are companies better served by making acquisitions of competitors or by extending up and down the industry’s supply chain with vertical acquisitions?

    #83389

    Anjeli Narine
    Participant

    I suppose it would depend on what the acquiring company’s goal is/ what the driver is for the desire to conduct an M&A. The company would be best serve by an acquisition which meets its goals. For e.g. if its goal is eliminating competitors to create a monopoly or become a market leader, then acquiring competitors would best serve its needs, while if its goal is entering new markets or creating synergies in its products line then a vertical acquisition would best serve its needs.

    #85872

    Zach Dogar
    Participant

    Yes I agree with Anjeli. It depends entirely on the strategic goals of the acquirer.

    #85885

    Jenny Ewen
    Participant

    I think you also have to do a thorough market analysis of the competitive forces to know the impacts on the company and the downstream market impacts that could also result that would then come back to either help/hinder the company in the longer run.

    #86742

    Gabriele Frigerio
    Participant

    I think Porter would be a good reference in answering question. It would depend on strategy of buying company.

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