M&A market operations as a tool of domestic enterprises’ business model transformation

Economic Annals-ХХI: Volume 139, Issue 3-4(1), Pages: 43-46

Citation information:
Kravchenko, O. (2014). M&A market operations as a tool of domestic enterprises’ business model transformation. Economic Annals-XXI, 3-4(1), 43-46. https://ea21journal.world/index.php/ea-v139-11/

Olena Kravchenko
PhD (Economics),
Associate Professor,
D.Sc. Degree Seeker (Economics),
Donetsk National University of Economics and Trade named after Mykhayilo Tugan-Baranovsky
krav07@meta.ua

M&A market operations as a tool of domestic enterprises’ business model transformation

Abstract. This article reviews the main trends of the world market of M&A transactions and determines specific features of mergers and acquisitions market in Ukraine at the present stage. Based on the analysis, the main types of M&A transactions that may be undertaken by the domestic enterprises have been identified in order to transform their business models and adapt to the modern business environment. Purpose: complexity, uncertainty and the rate of change of the environment, the emergence of the new «players» in the market necessitated adaptation of the existing business models to the commercial landscape. This requires development of «reserve» measures for companies’ timely response to such changes, and thus update to their business models. One of the transformation mechanisms to update business models is the processes of mergers or acquisitions. Methods. On the basis of statistical methods, in this article the main trends of the modern market of M&A transactions are analyzed as a tool for transformation of the business model. Results. The study determined that the domestic market of mergers and acquisitions is entirely new (compared to the world) and still is not fully formed element of the market economy. The main objectives set by the national members of M&A transactions are specified. They include: access to new markets, products, distribution channels; more efficient usage of existing resources; financial stabilization; changes in the rate of economic development; reducing the likelihood of being swallowed by another company. As a result of this research, a matrix of strategic intent has been built as a mechanism for effective study strategies on mergers and acquisitions in two aspects: the scope and the source of benefits. Discussion. M&A is a tool to create a strong position at emerging markets by increasing the size, a number of customers, synergy effects realization, and a combination of resources, knowledge and merged companies’ power. To ensure transparency of the modern business models and improve their competitiveness in the global market of M&A transactions, it is necessary to conduct a series of government reforms. This would have positive impact not only on the image and effectiveness of the domestic business models, but also on the image of the state as a whole and its positive economic development.

Keywords: Enterprise; Business Model Transformation; Merger; Acquisition; Spin-Off; M&A Transactions

JEL Classification: G34

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Received 22.02.2014