Restructuring American Corporations: Causes, Effects, and Implications

Restructuring American Corporations: Causes, Effects, and Implications

Restructuring American Corporations: Causes, Effects, and Implications

Restructuring American Corporations: Causes, Effects, and Implications

Synopsis

Written for financial and management executives, this volume provides a comprehensive and detailed examination of the restructuring of American business which has resulted from a spate of large-scale mergers, acquisitions, takeovers, and buyouts. Alkhafaji explores the reasons for the increasing popularity of takeovers, mergers, and buyouts; who benefits from and who is affected by these strategies; who loses and who wins in the process; the international aspects of corporate restructuring; and the future implications for financial and senior managers.

Excerpt

The main reasons investors such as Kohlberg, Kravis, & Roberts and Drexel, Burnham Lambert, Inc., buy out large corporations are the large amounts of short-term money that can be made and the tax advantages that result. Stockholders, investment bankers, and high-level management also stand to benefit from a buyout. These facts have led to a dramatic increase in the number of buyouts in recent years.

There is, however, a negative aspect to the buyout phenomenon the United States is currently experiencing. The tax advantages of buyouts ultimately become a burden to the individual, creating more problems for society as a whole. In addition, mergers, takeovers, and buyouts are allowing investors to restructure corporate America. This strikes fear in the heart of average Americans concerned about job security.

American blue-collar workers need to worry about their jobs; however, lower-, middle-, and top-level managers' jobs could be on the line as a result of corporate restructuring as well. This possibility implies that current and future managers should be concerned about the implications of the many buyouts that have taken place, are currently taking place, and will continue to take place unless something is done to control them. If nothing is done managers will have to be more diligent in monitoring the corporate environment.

Although the popularity and frequency of buyouts are on the rise, many oppose hostile buyouts and are trying to curb such occurrences. One . . .

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