Potential challenges of the mergers and acquisitions strategy

Recently, a number of well-known companies in Kenya have explored mergers and acquisitions as part of their strategy to remain competitive. A merger typically occurs when two companies agree to come together and operate as a single business entity while an acquisition occurs when one company buys a majority shareholding in another company.

The reasons for choosing mergers and acquisition as a strategy vary depending on the objectives of the parties involved. In Kenya, the implementation of new accounting standards has been cited as a possible reason for making mergers and acquisition strategy an attractive choice for companies in the financial sector.