Difference between revisions of "Synergy"
(→Definitions) |
|||
| Line 7: | Line 7: | ||
According to [[Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition)]], | According to [[Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition)]], | ||
:[[Synergy]]. The condition wherein the whole is greater than the sum of its parts; in a synergistic merger, the post-merger value exceeds the sum of the separate companies' premerger values. | :[[Synergy]]. The condition wherein the whole is greater than the sum of its parts; in a synergistic merger, the post-merger value exceeds the sum of the separate companies' premerger values. | ||
| + | According to the [[Corporate Strategy by Lynch (4th edition)]], | ||
| + | :[[Synergy]]. The combination of parts of a business such that the sum is worth more than the individual parts – often remembered as '2 + 2 = 5'. | ||
==Related concepts== | ==Related concepts== | ||
| Line 14: | Line 16: | ||
*[[Introduction to Financial Management]]. | *[[Introduction to Financial Management]]. | ||
| − | [[Category: Financial Management]][[Category: Articles]] | + | [[Category: Financial Management]][[Category: Articles]][[Category: Strategic Management]] |
Revision as of 09:18, 12 July 2020
Synergy is a phenomenon that occurs when the whole is greater than the sum of its parts. When applied to mergers, a synergistic merger occurs when the post-merger earnings exceed the sum of the separate companies' premerger earnings.
Definitions
According to Financial Management Theory and Practice by Eugene F. Brigham and Michael C. Ehrhardt (13th edition),
- Synergy. Occurs when the whole is greater than the sum of its parts. When applied to mergers, a synergistic merger occurs when the post-merger earnings exceed the sum of the separate companies' premerger earnings.
According to Fundamentals of Financial Management by Eugene F. Brigham and Joel F. Houston (15th edition),
- Synergy. The condition wherein the whole is greater than the sum of its parts; in a synergistic merger, the post-merger value exceeds the sum of the separate companies' premerger values.
According to the Corporate Strategy by Lynch (4th edition),
- Synergy. The combination of parts of a business such that the sum is worth more than the individual parts – often remembered as '2 + 2 = 5'.
Related concepts
- Financial management. A combination of enterprise efforts undertaken in order to procure and utilize monetary resources of the enterprise.
