Introduction

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The preceding sections of this book dealt primarily with mergers and acquisitions as a means of fueling corporate growth within a specific country. Part V addresses alternative strategic options for growth, including cross-border M&A transactions and business alliances. This section also discusses what can be done if corporations believe that more value can be created by exiting certain businesses or product lines or by reorganizing or liquidating either outside of or under the protection of the bankruptcy court.

Chapter 14 outlines the common motives for entering business alliances, ranging from minority investments to joint ventures as alternatives to mergers and acquisitions, as well as the critical success factors for establishing alliances, alternative legal forms, and ways of resolving common deal-structuring issues. Common exit strategies or restructuring strategies, discussed in Chapters 15 and 16, describe how corporations choose from among a range of restructuring options, including divestitures, spin-offs, split-ups, equity carve-outs, and split-offs to improve shareholder value.

Chapter 16 focuses on failing firms that may attempt to preserve shareholder value by negotiating voluntarily with creditors to restructure their outstanding debt outside of bankruptcy court; alternatively, such firms may choose or be compelled to seek the protection of the court system. This chapter also describes methodologies for predicting corporate default or bankruptcy and also how to value failing businesses. Finally, Chapter 17 outlines common motives for international expansion and describes widely used international market entry strategies. Ways to value, structure, and finance cross-border transactions also are discussed in detail in Chapter 17.