An investigation of the benefits and challenges of mergers (a case of Commercial Bank of Africa and First American Bank)
This research seeks to asses the effect of corporate mergers and acquisitions in the Kenyan financial sector, using the case of Commercial bank of Africa and First American bank. The specific objectives of this study will be to determine the efficiency gains if any realized from combining the management of the two firms. The effect of market power on the firms will be analyzed for instance to the extent with which market share has increased, and diversification of product range established. The operational synergy of the merger will be analyzed to establish whether the firm has gained any economies of scale or operational efficiency as result of the merger and the extent with which integration of technology processes and people has taken place. The research will also target to establish whether there have been any financial gains resulting from the merger such as reduced tax liability, risk diversification ,increased profitability and increased credit worthiness of the firm. The study will be carried out through a cross-sectional survey design. The data will be collected using a structured questionnaire where the respondents will be required to score on a 5-point likert scale indicating the extent of the effect of the corporate merger. Data obtained will be analyzed using frequencies ,percentages, mean score and factor analysis.