Essay --

1. IntroductionAs the world gets more global Companies do their top hat to raise their boodle and survive in the contention. Companies whitethorn have to grow to survive, and one of the best ways to grow is by merging with another company. However, virtually merges may disbalance the development of market and disrupt the balance of current market structure. hone example is the Daimler and Chrysler merger it is such poweful global corporation that has its activities all close to the world. It can use its strong position to influence the decisions of a governing body. If a government disagrees with the proposals, the corporation can easily move its bussines to another plain this allow for lead to higher unemployment in the country so the government can not allow this and is forced to make a trade-off. Nowdays some corporations have bigger powers than some governments and therefore it is harder to resist the influence of the corporations. amalgamations excessively lead to a de crease in competition in a market, this means higher prices and less choises for consumers. The European Union is trying to proscribe that companies become too powerfull and that is why firms who seek to raise their profits done merger, must attain European commissions (EC) approval. In this paper I allow for focus on the Volvo/Scania merger case. Firstly I will rationalise what is merger, the benefits of firms to conduct merger and the effect of merger to market. Secondly I will briefly describe the two companies which are involved in the Volvo/Scania merger. Finally, I will explain why did the EC blocked this merger. 2. What is mergerMerger is a process when at least two companies combine to phase angle one single company.In general, there are three types of mergers, even Mergers, if both f... ...cks, buses and engines businesses. After selling its car division Volvo had nearly no market trade, to become monumentalr again Volvo decided to buy shares of his largest conte st Scania.(Case No COMP/M.1672 Volvo/Scania)The merge between these two companies would cause a large decrease in competition on the Swedish market for trucks. Volvo treasured to grow to achieve the economies of scale to compete in the global markets, exclusively Volvo was prevented from doing so because the merger would give them too large market share in Nordic market.6. ConclusionThe EC has blocked the proposed merger of Volvo and Scania because of the competition concerns. The main reason was that these two companies, which both make trucks and buses were the two largest competitors in most of their European markets, it would create significant barriers to entry the market by other companies.