Havells Case

1. Does the proposed learning make sense for Havells? why or why not? Ans The proposed acquisition makes sense for the following reasons ? The acquisition of Sylvania will give in Havells access to the wide selling networks of SLI. It will serve as a good channel 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, have got and Marlin ?Exposure to lighting and lighting fixtures segment, as Sylvania was primarily engaged in this segment whereas Havells had a slender presence in the lighting market. . What are the major risks associated with this acquisition? Can these be managed? Ans study Risks associated with the acquisition are- Strategic risk is the current and prospective impact on earnings or metropolis arising from adverse business decisions, improper implementation of decisions, or lack of responsiveness to industry changes. There is a risk that the acquisition fails to bring out the desired synergy.Operational risk is, as the name suggests, a risk arising from execution of a companys business functions. It is a very broad concept which focuses on the risks arising from the people, systems and processes with which a company operates. There is a huge going 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 name for any risk associated with any form of financing. Risk may be taken as downside risk, the difference between the actual return and the expected return (when the actual return is less), or the uncertainty of that return. The acquisition deal of Sylvania was expected to cost more than $200 million, which is a huge amount for Havells. Also at that place is uncertainty about the returns from the acquisition