Amalgamation

PRESENTATION ON AMALGAMATION
PRESENTED BY :- KRISHNA kELA

What is amalgamation ???
An amalgamation is a combination of two or more

companies into a new entity. Amalgamation is distinct
from a merger because neither company involved survives
as a legal entity. Instead, a completely new entity is formed
to house the combined assets and liabilities of both
companies.
What Merger Actually is ?????
A merger usually involves combining two

companies into a single larger company.
Horizontal mergers may happen between
two companies in the same industries.
AMALGAMATION
Advantages of amalgamation.
1. Operating economics :- Operating economics means

expenses associated with business and its allied activities. These
expenses are required to carry on day-to-day activities of the
business. These generally include fixed cost and variable cost .
•Under operating economies
1.They also manage to reduce operating cost,
management cost, personnel cost, etc.
2. Hence, based on above discussion, we can say that,
amalgamation results in operating economics.
Advantages of Amalgamation?
• 2. Diversification
Diversification means to have presence (establishment) in
different business ventures, which are not related to each other
An amalgamated company diversifies into new business ventures
because of following main reasons:
• It has enough strength to handle the risks of diversification.
• It also has ample financial resources at its stake to diversify.
• 3. Financial economics
Financial economics means expenses associated with the
acquisition of funds required to run the business. This covers long-
term and short-term monetary obligations . Underr financial
economies:
• An amalgamated company can get tax benefits, especially, when
a loss-making company amalgamates with a profit-making
company.
• It can borrow more funds from the market at lower rate of
interest.
• 4. Growth
Generally, business operations of an amalgamated company grow
faster than individual companies . This growth is possible due to
the following main reasons:
• An amalgamated company can face competition more
effectively.
• It can share past experiences as and when required.
• It can also take maximum advantage of joint expansion plans.
Merger of banks …..
CANARA BANK
+
SYNDICATE BANK
CANARA BANK + SYNDICATE BANk
• Canara Bank, Syndicate Bank to merge . It become 4th largest

public sector bank.
• Finance Minister Nirmala Sitharaman announced the merger of
two banks - Canara Bank and Syndicate Bank - both of which
operate mainly in the South.
• These two banks will be consolidated to form the fourth largest
public-sector bank with business of Rs 15.2 lakh crore. Canara
Bank has Rs 10.4 lakh crore and Syndicate Bank has Rs 4.7 lakh
crore in business.
CANARA BANK & SYNDICATE BANk
• These banks together will have the third largest branch network
in India with 10,342 branches across the country.
• Canara Bank currently has 58,350 employees and Syndicate
Bank has 31,535 employees. The total strength of the two
banks together will be 89,885 employees.
Benefits after merger of banks .
• Scale :- A bank merger helps your institution scale up quickly and gain a large
number of new customers instantly. Not only does an acquisition give your bank
more capital to work with when it comes to lending and investments, but it also
provides a broader geographic footprint in which to operate. That way, you
achieve your growth goals quicker.
• Efficiency :- Acquisitionss also scale your bank more efficiently, not just in
terms of your efficiency ratio, but also in terms of your banking operations.
Every bank has an infrastructure in place for compliance, risk management,
accounting, operations and IT – and now that two banks have become one,
you’re able to
more efficiently consolidate and administer those operational infrastructures.
Financially, a larger bank has a lower aggregated risk profile since a larger
number of similar-risk, complimentary loans decrease overall institutional risk.
• Business Gaps Fille :- Bankk mergers and acquisitions empower your business to
fill product or technology gaps. Acquiring a smaller bank that offers a unique
revenue model or financial product is sometimes easier than building that business
unit from scratch. And, from a technology perspective, being acquired by a larger
bank might allow your institution to upgrade its technology platform significantly.
• Talent And Team Upgrade :- While not a factor on the balance sheet, every bank
benefits from a merger or acquisition because of the increase in talent at
leadership’s disposal. An acquisition presents the possibility of bolstering your
sales team or strengthening your team of top managers, and this human element
should not be ignored or downplayed.

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PRESENTATION ON AMALGAMATION

PRESENTED BY :- KRISHNA kELA

An amalgamation is a combination of two or more

A merger usually involves combining two

1. Operating economics :- Operating economics means

• Canara Bank, Syndicate Bank to merge . It become 4th largest

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