Strategic levers for merger and acquisitions in the financial services sector

Abstract

Mergers and acquisitions (M&A) is a very topical area. Every organisation has its vision to become a reputable company which is achievable through maximising its market share and future growth. The rationale of the study was a review of mergers and acquisitions in the financial services sector in South Africa and the subsequent massive restructuring in terms of strategic importance and strategic levers from a turnaround perspective, hence we then trying to establish whether the mergers and acquisitions within that period has been effective based on brand image, culture (people effectiveness) and return on investment. The literature review documented and evaluated current and past research as well as the theoretical framework on strategic levers for mergers and acquisitions in the financial services sector. The researcher adopted the quantitative method of research by use of a survey questionnaire. The discussion was presented in a narrative format, and tables, graphs and figures emerging from the findings were used as a basis for the discussion, paying particular attention to the fundamental research objectives and questions. Relevant descriptive and inferential statistics were used to analyse the data collected uncovering some key issues through the analysis. An exploratory factor analysis was conducted and further multiple regression was applied to determine whether the independent variables of brand image and culture were significant predictors of the dependent variable, return on investment. The research findings and recommendations uncovered that from a turnaround perspective in mergers and acquisition deals, brand image, and the culture (people effectiveness) should be in sync to generate the desired return on investment. As a result of greater market share and attainment of other synergies, this would allow firms to muscle flex which lays the platform to launch into uncontested markets like Africa.