Written Assignment
Organizations seek to expand in a variety of ways. One of the most common ways is by merger or acquisition. Amazon and MGM have signed an agreement for Amazon to acquire MGM.
Do some research on that event to understand the intent of that expansion effort. This assignment focuses on trying to understand what motivates a company to merge or acquire another firm.
Format your paper to correspond to the questions and labeled for each question. Only material presented in response to each question will be considered as applicable to that question.
1. 15 points: Explain in your own words each of the concepts of market power, scope, scale.
2. 10 points: Define and explain the concepts of vertical and horizontal acquisition.
3. 10 points: Define and explain the concepts of operational and corporate relatedness.
Use these terms, as appropriate, in your responses below.
4. 15 points: For Amazon:
a. Identify and describe the core competencies of the firm and identify any unique or critical resources that support their core competencies.
b. Why has this company been successful so far?
5. 15 points: For MGM:
a. Identify and describe the core competencies of the firm and identify any unique or critical resources that support their core competencies.
b. How would you evaluate this company’s position in their industry?
c. Have they been profitable?
d. In what way might Amazon contribute to improved success for MGM?
6. 25 points: What motivates the expansion? (Remember to use the terminology from the first three questions!)
7. 10 points: Using the information that you have provided above, was this merger a good move strategically?
Do you believe the combination of these firms provides enhanced competitive advantage? Why?
