Benefit of Merger/Acquisition to RSE

There are many benefits which come from merger and acquisitions especially to the company or business that is going to take over the company. One great company is more advantageous and beneficial that two companies competing for the same market or for the same raw materials. Taking over the market of Flinder Valves (FVC) is a benefit to RSE since Flinder valve is an already established company and that has its market in United States and other big countries where the market is at its best level such as Korea and Brazil (University of Virginia, 2008). FVC deals with the heat exchangers and valves and the current market for the products is very attractive. Looking at the already established market, it is evident that RSE will benefit from the merger considering the fact that Brazil, Mexico and Korea are emerging economies in the world. At least above 30 percent of the heat exchangers and valves used in mainly Brazil and Mexico come from Flinder valves and this makes it possible for the company to even take over the market with huge levels.

The management of FVC had taken its time and done valued research which could assist the company growth and which allowed the company to be in a better position in the next 5 years. Such research is vital since it assures the company of success using the right means to reach the goals. RSE deals with products such as bolts and nuts, cables and chains and combining these two companies, there would be increased profits from one market to another (University of Virginia, 2008). Considering the financial statement for FVC since 2007 to 2012, there has been growth in the net income and this gives an assurance that the company is headed for success as the years pass.   

 

Reference

University of Virginia, (2008). FLINDER VALVES AND CONTROLS INC. Darden Business Publishing