The purpose of this paper is to examine the key issues involved in the process of mergers and acquisitions of companies and to explore the experience in a small developing country. However, two important issues have not surfaced as questionable practices deriving from mergers and takeovers, one having to do with the rights of employees in mergers and the second concerning the responsibilities of shareholders during these activities werhane, 1998. The right merger can take the combined firm to the next level of excellence. It undercuts the natural but usually naive assumption that international legal issues, simply by being international, are necessarily larger than life. Pdf understanding information systems integration deficiencies. Fmc mergers and acquisitions in canada 49 labour relations and employment considerations introduction when acquiring the shares or assets of a canadian private or public company, a number of employment issues need to be addressed.
Companies and individuals with information regarding nonpublic merger or acquisition transactions should be mindful of the rules and regulations preventing insider trading on such information. Methods by which corporations legally unify ownership of assets formerly subject to separate controls. Ethical issues surrounding information systems will be covered in chapter 12. Information systems bring new opportunities and advantages to how we do business but they also introduce issues that can negatively affect society cybercrime. Pdf information systems is integration is a critical challenge for valuecreating. Key legal issues to consider in a merger or acquisition in us. We will examine each one of these issues in turn and begin by defining some of the most important issues that are relevant to information systems in each field. Consider the following guidelines to preempt speedrelated collaboration issues and merger integration. Mergers and acquisition post merger it integration. But the merger of icici bank and mahindra tractor it is not. The impact of mergers and acquisitions on information. In todays new legal environment, managers who violate the law and are convicted will most likely spend time in prison. The organisational world is still shaking from the impact of individual and organisational actions that are contrary to the openended community standards of ethics. Merger and acquisition transactions can be quite complicated and require both the acquiring and target companies to address the following issues in detail to avoid challenges later on.
Software development companies or it vendor whom company is in contact faces number of issues and challenges in integrating information systems of two different companies owing various reasons. Legal developments have amen sinee the last wave of merger aetivit by michael w. May 05, 20 it is important to distinguish between ethical and legal implications of information system management in a way that unlike legal issues, ethical issues do not necessarily result in the organisations being punished by law. In the next three sections we will focus upon the legal, ethical and social issues on information systems. Pdf ethical, legal and social aspects of information and. Apr 03, 2017 by setting sensible goals, company owners can maintain momentum throughout the post merger integration process. In practice, the terms mergers, acquisition, and consolidation are often used interchangeably, because they differ only in terms of legal aspects. When contel cellular and gte mobile communications. Sensitive business information allows a potential purchaser or merger party to assess the true value of a business and evaluate whether the target. One of the reasons, many postmerger integration activities fail, is due to the information technology complexity and inadequacy to address the issues, it brings to the table. Corporate merger legal definition of corporate merger. This acquisition is interesting for a number of reasons, and is very likely to affect the future of professional social. As information in cyberspace can be accessed globally, a research field of computer ethics is needed to examine. Challenges faced in merger and acquisition for information.
To calm anxious workers, executives often make unrealistic promises they cannot deliver. The ethical and legal implications of information systems. The impact of mergers and acquisitions on information systems. Understanding ethical and social issues related to systems in the past 10 years, we have witnessed, arguably, one of the most ethically challenging periods for u. Ethical issues in cyberspace and it society hary gunarto ritsumeikan asia pacific university abstract. First, it shows how the law of international business often involves commonplace issues. Challenges faced in merger and acquisition for information system like erp. Legal and procedural aspects of mergers mba knowledge base. The ge and honeywell vignette illustrates a few legal issues pertinent to international business. Pdf an overview of key issues in mergers and acquisitions. The main purpose of this merger is to obtain economy of scale in production by eliminating duplication of facilities, reducing of competition, reduction of cost, increase in share price and market segments.
Sep 15, 2014 merger and acquisition transactions can be quite complicated and require both the acquiring and target companies to address the following issues in detail to avoid challenges later on. Information sharing between transacting parties, both at the pretransaction and posttransaction stages, can give rise to serious competition law infringements where the. When nec essary, steps should be taken to help address these. Key legal issues to consider in a merger or acquisition in. Due diligence can help with the evaluation process and prepare businesses to address existing issues surrounding finance, compatibility, management, and legal areas. Cramming more components onto integrated circuits pdf. The next challenge deals with the difficulties that arise post merger when trying to integrate people, systems, and business processes in order to maintain efficiency. There are many ethical and legal issues involved in the.
Planning integration of an acquired companys legal. Ethical, legal and social aspects of information and communication technology conference paper pdf available september 2007 with 16,237 reads how we measure reads. However, merger and acquisition activity is complex and can involve many different kinds of challenges from start to finish. Success factors for integrating it systems after a merger. The anonymity of some communication systems may lead to unethical behavior.
Some computers combine the two storage technologies. Lacking the resources to manage the integration before the deal is closed, both companies should plan for integration, which presents multiple challenges in the it, financial, sales, overhead, and cultural departments. The steering committee on the issue of mergers usually spends more time choosing a new logo than dealing with the problems of it and is. If you are contemplating a crossborder merger, make sure you take appropriate professional advice from the start. The right merger can work when ego is put aside, and a new approach propels the merger participants toward their goals, more quickly and more effectively than is possible on their own. It can uncover potential issues relating to legal and. Information systems and quantitative analysis faculty publications. It is the role of human resource personnel to ensure the code of ethics is used in. Issues and proposals claudia canali, michele colajanni, riccardo lancellotti department of information engineering university of modena and reggio emilia claudia. An organization needs to address these issues and come up with a framework mis security, ict policy, etc.
The surviving company is a registered investment company or a series thereof. The specific legal and ethical issues that should be considered before the merger are the leadership that will be required for the merged company. Third, in many cases, such as in pennsylvania, the documentation requested together with the state filing is extensive and could include basic corporate organizational documents and related board records, all relevant transaction documents, information regarding the successor party, and information relating to the impact on employees and. To keep the key issues framework current, sim and the misrc initiated a study in 1986 to reevaluate the key issues in information systems management. The most notorious application of the community asset controversy in the mergeracquisition scenario was the june 2000 dissolution under substantial attorney general pressure of a 1994 merger between a catholic hospital and a communitybased hospital in manchester, nh the creation of. The income tax act, 1961 of india uses the term amalgamation for merger. Legal, ethical and social issues on information systems. To view the pdf you will need acrobat reader, which may be downloaded from the adobe site. If the parties are exchanging information prior to reaching the letter of intent stage of a potential transaction, a confidentiality agreement should be executed first. The wrong merger the wrong merger can dilute and damage quality, focus, collegiality. Information system integration in mergers and acquisitions.
Ethical dilemmas during mergers, acquisitions, and takeovers. A merger or acquisition is a combination of two companies where one corporation is completely absorbed by another corporation. Accept that speed preferences and requirements do exist, at company, team, and individual. They are seen by many as a relatively fast and efficient way to expand. Consolidating staff and system platforms during a merger is a highly charged and complex undertaking and it is right in the thick of it. Ethical dilemmas during mergers, acquisitions and takeovers. These issues have to be resolved in order to ensure a successful merger. A merger of a registered investment company or a series thereof and one or more other registered investment companies or series thereof or eligible unregistered funds is exempt from sections 17a1 and 2 of the act 15 u. Jul 12, 2011 consider the following guidelines to preempt speedrelated collaboration issues and merger integration. Among others, the issues involved were whether a merger of two companies constituted an assignment of the plaintiffs contract by the fire alarm company and the effect of. The procedure of amalgamation or merger is long drawn and involves some important legal dimensions.
Mergers occur when the merging companies have their mutual consent. An interesting case was recently decided by the united states district court for the northern district of ohio. Merger and acquisition due diligence ur scholarship repository. Integration of an acquired companys legal department the lack of attention to developing effective strategies for integrating an acquired companys legal department is extremely shortsighted and causes many companies to miss the numerous opportunities that may be presented by the acquired company. Outline of legal aspects of mergers and acquisitions in the united states introduction this outline summarizes important aspects of united states law as it relates to mergers and acquisitions. Since the issues in share acquisitions are very different from asset purchases. To keep the key issues framework current, sim and the misrc initiated a study in 1986 to reevaluate the key is sues in information systems management.
General, with application to law selected instructional technology selected journals on legal information systems. Employment law issues in mergers and acquisitions zelle. The broad aspiration of this special issue was to build upon, and contribute to, an emerging stream of research addressing information systems. Business information technology poses both security risks and ethical conundrums. Setting employees up for disappointment is a sure way to lose top talent and, when that happens, all other aspects of the merger process become more difficult. Evaluating information technology it integration risk prior to. As the spread and use of information technologies in the business world have quickened, the failure of current laws to meet the needs of a digital, information based society has become apparent. There can be various legal implications in the postacquisition scenario. Ethics is a branch of philosophy that deals with what is considered to be right or wrong. Every merger is different, and can have innumerable reasons for failure, ranging from poor implementation strategies to cultural or attitudinal problems. Outline of legal aspects of mergers and acquisitions in the. Three years provide a lot of time for change in the information systems profession. Managing information systems integration in corporate mergers.
For example, the merger of icici bank and bank of madura is a horizontal merger. One of the reasons, many post merger integration activities fail, is due to the information technology complexity and inadequacy to address the issues, it brings to the table. The composition of the team after the merger, preselection and selection of persons, and conducting full due diligence in all areas is important. The execution of this certificate constitutes an oath or affirmation, under the penalties of false swearing under. It identified many significant issues relating to structuring and acquisition, including tax, accounting. Mergers and acquisitions are increasingly being used by firms to strengthen and maintain their position in the market place. With ask the experts, submit your questions to our certified professionals and receive unlimited, customized solutions that work for you. Ethical implications of information system management. The legal issues must be addressed by the entities transacting acquisition.
Integration and information technology effects on merger. For more information about the legal aspects of partnership agreements, see joint ventures and business partnerships. Employment law issues in mergers and acquisitions zelle llp. Despite popular opinion, an acquisition isnt always mutually beneficial. It is important to distinguish between ethical and legal implications of information system management in a way that unlike legal issues, ethical issues do not necessarily result in the organisations being punished by law.
Ethical and legal issues 3 neglected in an institutional shareholder power. Theyve really been looking at market consolidation issues and issues with respect to the availability or monopoly of service. Legal information systems and legal informatics resources. Chapter 2 conceptual framework of merger and acquisition. As the spread and use of information technologies in the business world have quickened, the failure of current laws to meet the needs of a digital, informationbased society has become apparent. However, there are at least three cases where predefinitive agreement disclosure may be necessary or mandated. Merger integration challenges are especially prominent in the. Challenges faced in merger and acquisition for information system. Postacquisition fails miserably at the time of implementation stage. Outline of legal aspects of mergers and acquisitions in. Merger is a financial tool that is used for enhancing longterm profitability by expanding their operations. Pdf hr issues and activities in mergers and acquisitions. Information behavior selected information retrieval selected institutes, research centers, courses, departments, etc.
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