The government evidently believes that the merger will send a message to the world about its reformist zeal and improve investor sentiment at a time when the rupee is under pressure. Whether it constitutes meaningful reform at the present time is, however, open to question.
Rajiv Kumar, secretary, department of financial services, contended that the new entity is “positioned for substantial rise in customer base, market reach, operational efficiency and wider bouquet of products and services for customers.”
Well, that is always the hope in any merger. In this case, the hope is that one plus one plus one will make four. However, a wide body of research casts doubt on this proposition. According to a McKinsey study, only 30 per cent of mergers capture the expected synergies.
No comments:
Post a Comment