Havells Case

1. Does the proposed encyclopaedism rush sense for Havells? Why or why not? Ans The proposed acquisition makes sense for the following reasons ? The acquisition of Sylvania will give Havells access to the commodious marketing networks of SLI. It will serve as a good take for marketing Havells products in Europe ? Access to the R&D and engineering capabilities of SLI ? Ownership of various brands of Sylvania Sylvania, Zenith, Linolite, Claude, Concord and Marlin ?Exposure to light source and lighting fixtures segment, as Sylvania was primarily engaged in this segment whereas Havells had a vitiated presence in the lighting market. . What are the major risks associated with this acquisition? goat these be managed? Ans Major Risks associated with the acquisition are- Strategic risk is the flow and prospective impact on earnings or capital arising from indecorous business decisions, improper implementation of decisions, or lack of responsiveness to pains changes. There is a risk that the acquisition fails to bring out the craved synergy.Operational risk is, as the name suggests, a risk arising from execution of instrument of a companys business functions. It is a very broad concept which focuses on the risks arising from the people, systems and processes through which a company operates. There is a huge deviance in the culture of the two companies which presents a challenge of the integration of the European executives in the Indian team. yFinancial risk is an umbrella termination for any risk associated with any form of financing. Risk may be taken as downside risk, the difference between the actual return and the expect return (when the actual return is less), or the uncertainty of that return. The acquisition bed of Sylvania was expected to cost more than $200 million, which is a huge descend for Havells. Also there is uncertainty about the returns from the acquisition