Chevron Texaco Merger

What do you think the real reasons for Chevron Texaco union be? Unlike previous unions in the vegetable oil industry, it appears that the Chevron-Texaco merger was instigated much from a lack of size, than from a financial advantage. The ii companies on a stand-alone basis could not efficaciously struggle with the merged might of the likes of BP Amoco Arco, Exxon Mobil and TotalFinaElf. There is some legality to oil managements arguments that they can increase cost-cutting and efficiency by merging. specially in the area of exploration and fruit, where in new confines areas such as the former Soviet Union, risks are exalted both(prenominal) because of political and economic ciphers, such mergers increase the pool of large(p) purchasable to one firm to reduce such high risks. bandage it is less true in refining and marketing, mergers and union ventures do allow economies of scale, through building new facilities on a larger scale or by shimmy production to one refining facility while shut great deal another. However, the essence of such economies of scale is the reduction in the center of labor needed to produce a given everyplace amount of output. The Chevron Texaco merger might also take over been motivated by managements sack perspectives.

cover management probably saw in this merger the probability to get larger salaries and golden parachutes that would secure whatsoever accomplishable future outcome of the merger. According to a collect Meyer & adenosine monophosphate; Partners study of the covering 200 U.S. companies, 90 percent of a CEOs pay is tied to performance, and more(prenominal) than hal! f of that pay is in stock-option grants. Its no longer unusual for the CEOs equity stake to diadem $100 million, and mergers often involve sizable new grants and private parts up major(ip) windfalls. Ego could be a major factor in driving mergers, as executives privation more recognition, more... If you want to get a full essay, order it on our website: OrderCustomPaper.com

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