M & A’s- I’ll Drink to That

I.                      Introduction

Amidst the economic downturn over the world, many industries have seen a stunt in growth.  In fact, during recessions, often consolidation among competing businesses within an industry is the only alternative to extinction.  This is evidenced in the banking industry (i.e. Merrill Lynch sold to Bank of America in order to avoid bankruptcy) [1] as well the auto industry (i.e. Government gives Chrysler thirty day deadline to merge with Fiat). [2] Yet, in recent years, it is the beer industry that has seen more mergers and acquisitions than arguably any other sector.  This article will discuss the reasoning behind the consolidation within the industry, examine the strategic approaches taken in the industry when merging with or acquiring a competitor, and finally, the future of mergers and acquisitions (M&A’s) within the brewing industry.

II.                   Discussion

The increasing consolidation within the beer industry is Read the rest

Nationalized Treasure

I. Introduction

On February 27, 2009, the United States government announced that it was taking measures that could result in it taking as much as a 36% equity stake in Citigroup, Inc.[1] This would make the federal government the largest shareholder in Citibank.[2] By converting $25 billion in preferred shares into common stock, the federal government hoped that the move would stabilize Citibank in a tumultuous market.[3] As a result of this move, a number of people have voiced a growing concern over the federal government taking further steps to nationalize other major financial institutions.[4]

Through taking a 36% stake in Citigroup, the federal government did not fully nationalize Citibank.  As a result, Citibank is now caught between the private markets and governmental interests. While nationalization could seriously undermine confidence in the financial system, as Bank of America Chief Executive Officer Kenneth Lewis suggests,[5] this scenario poses some unique … Read the rest