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A Winter Project Report On

Merger and Acquisition in Banking Sector with Reference to ICICI Bank and Bank of Rajasthan, HDFC Bank and Centurion Bank of Punjab

In the fulfillment of the Degree of Master of Management Studies under the University of Mumbai By Name: Ankit J. Shah [Roll No: A-30] Specialization:Finance Under the Guidance Of Prof. Faruk Mistri (Professor)

Aruna Manharlal Shah Institute of Management and Research Ghatkopar [W], Mumbai-86 2011-2013

ACKNOWLEDGEMENT I have taken efforts in this project. However, it would not have been possible without the kind support and help of many individuals and organizations. I would like to extend my sincere thanks to all of them.

I am highly indebted to Prof. Faruk Mistri for their guidance and constant supervision as well as for providing necessary information regarding the project &also for their support in completing the project.

I would like to express my gratitude towards my parents & member of & their kind co-operation and also encouragement which help me in completion of this project.

I would like to express my special gratitude and thanks to industry persons for giving me such attention and time.

My thanks and appreciations also go to my colleague in developing the project and people who have willingly helped me out with their abilities.

OBJECTIVE The immediate objective of an acquisition is self-evidently growth and expansion of the acquirer's assets, sales and market share. A more fundamental objective may be the enhancement of shareholders' wealth through acquisitions aimed at accessing or creating sustainable competitive advantage for the acquirer. In modern finance theory, shareholder wealth maximization is posited as a rational criterion for investment and financing decisions made by managers. Share holder wealth maximization may, however, be supplanted by the self-interest pursuit of managers making those decisions. According to the managerial utility theory, acquisitions may be driven by managerial ego or desire for power, empire building or perquisites that go with the size of the firm. When managers seek to enhance shareholders' wealth, they must not only add value, but also ensure that the cost of the acquisition dies not exceeds that value. Value creation may occur in the target alone, or in both the acquirer and the acquired firm.

INDEX

Chapter No. Chapter 1 Chapter 2 2.1 2.2 Chapter 3 Chapter 4 Chapter 5 Chapter 6 Chapter 7 7.1 7.2 7.3 7.4 7.5 7.6 7.7 Chapter 8 8.1 8.2 8.3 8.4 8.5 8.6 8.7 Chapter 9

Particulars Page No. Banking sector overview 1 Introduction What is Merger? 3 What is Acquisition? Purpose of Merger and Acquisition 4 Types of Merger 6 Procedure of Merger & Acquisitions of Banks 7 RBI guidelines on Mergers & Acquisitions of Banks 8 Analysis of ICICI Bank - Bank Of Rajasthan Bank of rajasthan Introduction 9 Trouble for Bank of Rajasthan 10 Merger details 11 13 Analysis Bank of Rajasthan Pre Merger ICICI bank Introduction 16 18 Analysis ICICI Bank Pre-Merger 21 Analysis Bank of Rajasthan & ICICI Bank (Post Merger) Analysis of HDFC Bank - Centurion Bank Of Punjab HDFC bank Introduction 24 23 Analysis HDFC bank Pre Merger Centurion Bank of Punjab Introduction 28 Reason for Merger 29 Merger details 30 Analysis Centurion Bank of Punjab Pre Merger 31 Analysis HDFC and Centurion Bank of Punjab Post Merger 34 Conclusion 37

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