FedEx Acquisition of Kinko’s Harvard Case Solution & Analysis

FedEx Acquisition of Kinko’s  Case Solution

Statement of objective

The Primary objective of this project report is the detailed and objective evaluation of the strategic acquisition of Kinko's made by FedEx. The analysis will specifically focus on the qualitative and quantitative aspects of this M&A deal. The project will also throw some light on the merger and acquisition prospect in the corporate world and the industry, briefly. The main theme of the project, FedEx Acquisition of Kinko's, will be examined from different perspectives and the evaluation will be based on pre-acquisition and post-acquisition perspective as well.


Mergers and Acquisitions in Corporate world

Different companies have different objectives, which will be discussed later, for making acquisitions. It has now become a major source to achieve competency and expansion. Local companies make Mergers and Acquisitions to go global, whereas small companies make Mergers and Acquisitions to get larger and global companies make Mergers and Acquisitions to consolidate competitive advantages and gather greater market share. There are unlimited advantages of this strategy. Nevertheless, this strategy is the most difficult, when it comes to implementation stage. The acquisition can become hostile, if it is not strategically fit with the organization.

Mergers and acquisitions started in the late 1800s and it has until now gone through 6 waves, the 7th wave is in progress. Discussing the last completed wave, which is the sixth wave, the focus of the organization is on globalization. In this wave, shareholders have become more active and have actively been involved in the affairs of the organization. In this wave, globalization and expansion were the key factors for making an acquisition. Larger organizations make several acquisitions in order to reach to emerging markets. With such situation, where organizations are strengthening their competitive advantage, other competitors make acquisitions in order to compete with them. This boosted the six waves and about $1 trillion solely expanded on Mergers and Acquisitions in U.S (G.Alexandridis, 2010).

Objectives of M&A

Mergers and Acquisitions are a common feature in this current business world. It is not a usual activity, but has some purpose behind it. Some of the objectives behind acquisitions are identified as follows(Bower, 2001):

  • Opportunity to enter into new market segments and new products and services
  • Substitute for avoiding research and development (new technology)
  • Overcapacity solution through consolidation, specifically for manufacturing industry
  • Roll-up tactic to overcome other competitors in the fragmented industry.

FedEx Acquisition of Kinko’s

Kinko's was an appropriate target for FedEx to expand its business. The company wanted to grow its retail outlet business as well as emerge into new market segments and increase the portfolio of its services. The strategic acquisition not only will provide expansion and growth to the company, but will also increase the competitive advantage and slightly increase the market share. The acquisition promises high future business prospect as well as expansion of services offered

Kinko’s corporate strategy

Kinko's, which was established in 1970, as a photo copying company, a copy shop. The company gradually and steadily grew and the company was operating through connected partnerships. The company had almost 127 partnership stores until 1997.

Kinko's main business was to provide photocopying and print services through the chain of retail shops. The company has self-services retail stores, where the customer can use fax, photocopying, printing, and computing services. Office supplies are also on sales at these shops.......................

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