Comparison Of Pixar And Disney's Merger

Because of the merger that happened ten years ago, children all over the world can now enjoy a cartoon fiesta. Pixar and Disney’s merger back in 2006 was the beginning of a beautiful cartoon era where the collaboration of both companies led to a better representation of cartoons. ”Much of what is called investment is actually nothing more than mergers and acquisitions” (Susan George). Companies’ mergers are beneficial acts for both, where the two or more companies combine where companies securities and stocks are exchanged between parties of interest. There are many reasons for such mergers to occur such as; diversification, eliminating competition and synergy. The first cause for two companies to merge and combine their assets is diversification. This is an important aspect in merging since it ensures both companies less of a risk regarding the investments made in the project. The investment is split in half to diversify, or work on multiple projects rather than one, ensuring better odds in the returns. As the author states in investing in two films to diversify the projects:” by investing in two films instead of one, there is less variability in the returns and thus reduced risk.”(Phillips, 1997). A company that merges

Two companies merging offer the best qualities of both parties to be combined and create a better project together than individually. This leads the companies’ target market to increase in size. Instead of clients leaning towards a certain brand or service which is adequate enough, they’ll tend to a company that idealizes perfection such as companies who have merged and risen in a better product. This, in return, renders the opposing competitions helpless, where their clients gradually decrease until none are left. Merging and acquisition deals allow the acquirer to eliminate future competition and gain a larger market share in its product's market