Her assistance is greatly appreciated. Further thanks to my parents and my family for their unlimited support during my study in U. K. This dissertation is aimed at finding motives and assessing the consequences of mergers and acquisitions, taking Tata Tea’s acquisition of Tetley into consideration. It overviews a vast amount of theoretical literature on mergers and acquisitions and presents empirical literature findings on company’s post-merger financial performance. Case study section of the dissertation considers the history of Tata Tea Ltd. or engaging in M&A activities and measures the consequences of the activity by applying accounting and empirical financial approaches. Quantitative data is obtained from both online and published resources. The findings from the study are: Mergers and acquisitions contribute to increase in net sales revenue. Their impact on market share can either be neutral or positive. Quantitative data is taken from company’s annual reports, business research companies’ archives and financial websites.
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But fortunately, that doesn’t remain the prerogative anymore. The war-averse domestic companies are shedding their inhibitions. The roles have undoubtly changed. And, after fighting in out in the global commodities arena, it is time now for a global teacup. Taking a plunge in the global tea war in the year 2000 was India’s corporate tea giant Tata Tea. Though it was not an easy decision to make, that to when the competitor was no less than a stature of Unilever, a global food and beverage behemoth, but the Tata Tea had little choice – shape up or be swapped.
It chose the former. And, what else could have been a better vehicle than Tetley for Tata tea to take on the might of global tea giants like Lever and Hillsdown. The expansion took place through the acquisition of another tea giant from the UKTetley. Tata tea finally tasted victory on March 10, 2000 when it bought Tetley for a staggering INR 2,135 crore (305 million sterling). Such a deal had never been heard or seen before in the Indian Corporate world. What makes this deal special is the fact that it 6 is the first ever LBO (Leveraged Buy Out) by any Indian company.
