A STUDY ON MEGERS AND ACQUISITIONS IN BANKING SECTOR

Synopsis submitted in partial fulfillment of the requirements for the award of the degree of

MASTER OF BUSINESS ADMINISTRATION

Of

CMR INSTITUTE OF MANAGEMENT STUDIES (AUTONOMOUS)

Affiliated to Bangalore University By Mr. PAVAN KUMAR PATTAR Register No: - 12201049 Under the guidance of Dr. K. SUGUNA Professor Department Of Management Program

CMR INSTITUTE OF MANAGEMENT STUDIES (AUTONOMOUS) C.A. #2, 3rd C Cross, 6th A Main, HRBR Layout 2nd Block, Kalyana Nagar Bangalore 560043 2012 2014

Introduction to Mergers and Acquisition In Banking Sector

We have been learning about the companies coming together to from another company and companies taking over the existing companies to expand their business. With recession taking toll of many Indian businesses and the feeling of insecurity surging over our businessmen, it is not surprising when we hear about the immense numbers of corporate restructurings taking place, especially in the last couple of years. Several companies have been taken over and several have undergone internal restructuring, whereas certain companies in the same field of business have found it beneficial to merge together into one company. In this context, it would be essential for us to understand what corporate restructuring and mergers and acquisitions are all about. The phrase mergers and acquisitions (abbreviated M&A) refers to the aspect of corporate strategy, corporate finance and management dealing with the buying, selling and combining of different companies that can aid, finance, or help a growing company in a given industry grow rapidly without having to create another business entity. Thus important issues both for business decision and public policy formulation have been raised. No firm is regarded safe from a takeover possibility. On the more positive side Mergers & Acquisitions may be critical for the healthy expansion and growth of the firm. Successful entry into new product and geographical markets may require Mergers & Acquisitions at some stage in the firm's development. Successful competition in international markets may depend on capabilities obtained in a timely and efficient fashion through Mergers &Acquisitions. Many have argued that mergers increase value and efficiency and move resources to their highest and best uses, thereby increasing shareholder value. To opt for a merger or not is a complex affair, especially in terms of the technicalities involved. Considerable amount of brainstorming would be required by the managements to reach a conclusion. e.g. a due diligence report would clearly identify the status of the company in respect of the financial position along with the net worth and pending legal matters and details about various contingent liabilities. Decision has to be taken after having discussed the pros & cons of the proposed merger & the impact of the same on the business, administrative costs benefits, addition to shareholders' value, tax implications including stamp duty and last but not the least also on the employees of the Transferor or Transferee Company.

Problem Statement: To analyze the various factors affecting during the Merger and Acquisition of company. Objectives:
To study the purpose of mergers and acquisitions in the banking sector. To study the benefits of mergers and acquisitions. To understand the bank merger/amalgamation under various act. To study procedures of Bank Mergers and Acquisitions. To study the risk involved in merger and Acquisition. To understand the merger of ICICI Bank and Bank Of Rajasthan.

Research Methodology:
The Analysis is based on secondary Data and its Descriptive study. Secondary research based on: Business Magazines. Internet Sources. Finance Books.

Scope of the Study:

Scope of the study is to have ample knowledge about various Banks Growth & Diversification through M & A. To analyze the latest trends and development in the corporate environment in the field of Merger and Acquisition with reference to ICICI & Bank of Rajasthan.

Limitations of the Study:

Banks prefer keeping the financial transactions confidential, so that the data used for present study may not give complete picture of reality. All the information collected for the study are based on the Secondary data, they are not collected using practical approach.

Chapter Scheme:
Chapter 1 : Introduction Chapter 2: Purpose Of Merger and Acquisitions. Chapter 3: Benefits of Mergers and Acquisitions. Chapter 4: Changes in the Indian Banking Scenario. Chapter 5: Procedure of Bank Mergers and Acquisitions. Chapter 6: Risk in Bank Mergers and Acquisitions. Chapter 7: Case study on the Merger of ICICI Bank and Bank Of Rajasthan.