Improvement in corporate M&A process suggested

The Pakistan Economy Watch (PEW) on Sunday said corporate Mergers and Acquisitions (M&As) are good if the aim is to grow rapidly in short span without taking pain of expansion or starting another business. Proper M&As could help improve image, efficiency, services, reach and financial health of institutions and shareholders, says a press release issued here on Sunday.
Corporate combinations are futile if empire building, manipulation, tax evasion, quick public listing or dodging law is the real motive.
It should not contribute to unemployment and reservation among shareholders, said Dr Murtaza Mughal, President PEW. He said that policy of merging weak financial institutions (FIs) to avoid malfunction need to be revisited, as it is not practised anywhere in the world. Dr Mughal said that 247 banks have failed in America since 2008 while 702 are on watch list but the regulators have never pressed for mergers. Conversely, they were pushing an unwritten policy of mergers that could be described as self-deceit. Merger of fragile FIs could not make a healthy entity, its unnatural; he said, adding that such entities should be merged with strong ones.
Oversight of regulators in US resulted in demise of the entire investment banking industry, biggest insurance company, biggest mortgage lenders etc, he said. "We should learn lesson from their experiences. Risk management techniques must be improved because investments become worthless when the assets of an entity declines," he added.