Merger Mellon Financial and Bank of New York Case Study

Merger Mellon Financial and Bank of New York - Case Study Example How the two companies deal with the purchase and how the purchase is being reported to the public is what differ one term from another. Acquisition is when a firm takeover another firm (the target), become the only owner and its stock would still be traded unlike the target company. On the other hand, â€Å"mergers of equal† is when two companies seek the benefit ofbecoming one single company and neither is acquiring the other. Usually both companies are about the same size and shareholders would surrender their shares to be given in return the shares of the new single entity. Prior to the integration, a proper due diligence must be conducted before negotiating and closing the deal.Mergers are governed by each state’s law.The board of directors of the companies and the shareholdersmust approve the merger of equal first before it is put into action.After the approval is given, acommunication ground should be established and an integration process should be taken to combine the two business units systems in one new system. First, a merger integration committee (MIC) should be formed. The responsibility of MIC is to arrange and organize the integration process and to prepare the proposal for shareholders’ considerations. MIC considered being the main player in executing the merger not to mention being the coordinator for a harmonic and smooth integration as well as a value added post-merger success. The MIC should have weekly meetings to solve any issues that are notgoing as scheduled. In the case of the merger of equals of Bank of NY Mellon, the largest security servicing firm, the integration committee dedicated a lot of efforts so it will not be surprised by any chance. It dealt with the business lines in two methods in which it hired representatives to help in executing and request detailed reporting in weekly basis. The vision and objectives of the merger should be served through selecting the best possible Integration plan and team.The value of the new organization can be created through th e ability of taking tough decisions, which occurred during the shift of the administration, the procedures the technologies, the system not to mention the culture to implement the new organization vision. Changes made usually include the leadership structure (executives and board members) as a redistribution of positions and authority is likely to occur. The integration plan includes integration of strategy, reporting, people, procedures and culture. The administration style is the one who design and create the culture and the behavior which is one major part of the due diligence taken prior to the merger. As change is a critical part for any organization, Integration efforts of systems and servicesfirst require evaluating the speed of change (whether it is radical or not). It is crucial to dedicate theneeded time to complete processes. Second, it is important to maintain the customer focus during the integration and not to neglect it. Moreover, a clear intensive communication must be insured from an early stage internally and externally. Internal communication can be established by maintaining optimism and positivity among each employee toward the new transformation that has been brought by the merger. 2. List the five key risks and related controls the newly merged company faced during the integrations phase. Please consider the strategy considered by management of both companies during the negotiations? Culture risk; Culture is the set of values, beliefs, behaviors, assumptions shared among employees of a certain entity.It is what effect and influences the actions of the people within the firm, explains attitudes and why people behave in a certain pattern. It is taken for granted for people from the insideas it