"Restructuring for Business Growth: Emphasizing Mergers, Acquisitions, and Demergers" by IRJET Journal

"Restructuring for Business Growth: Emphasizing Mergers, Acquisitions, and Demergers"

Angel Jain

Abstract: This research paper examines the various effects that corporate restructuring via mergers, demergers, acquisitions or total market exit has on organizational performance and strategic positioning. For this, we take a case studyapproachanalyzingthreelandmarkepisodesinIndianbusinesshistory:TataGroup’sacquisitionofAirIndia,HDFC Ltd.’smergerwithHDFCBank,andthedemergerofTataMotors’passengervehiclebusiness.Eachcaseisanalyzedusing keyperformanceindicators-AirIndia’searnings,HDFCBank’searnings,andTataMotors’overallpassengernumbers.The purchase of Air India is analyzed in terms of revenue achievement, integration success metrics post-acquisition to understandwhatittakestoresuscitateaprivatelyheldpublicsectorunit.Theanalysis forHDFCBankmergerfocuseson finances consolidation impacts as well as operational cost efficiency improvements, capturing strategic value from diversified banking-housing finance subsidiaries under one mega bank tower. Tata Motor's analysis of the volume effect focuses on competitiveness resulting from specialization and targeted management after the split versus before it. This research incorporates comparative methods along with quantitative data to illustrate how different approaches to restructuringinfluenceoperationalperformance.

KEY WORDS:Mergers,Acquisitions,Revenue,Growth

1. Introduction

Exits,mergersanddemergersgreatlyaffectbusinesstransformation,themarketasawhole,andvaluegeneration. Mergers seek to join two or more firms with one purpose: to improve operational effectiveness a company may havepossessedinitspreviousstate,itsmarketpresenceandcompetitionheadon.Demergersaretheoppositeof mergerswhichincludesplittingupafirmintomultiplepartssothateachrespectivepartcangrowbyitselfwhich is beneficial for shareholder value too. Exits allows stakeholders such as investors or founders to achieve some level of return via acquisitions-based IPOs. These methods fundamentally allow companies to respond faster to changesinthemarket,operateefficiently,modernizethemselvesandfinallypositivelyinnovate.

a. Mergers

A merger integrates several businesses into one single organization to achieve strategic objectives, such as increased market share, reduced competition, or realizing economies of scale. In India, the consolidation of VodafoneIndiaandIdeaCellularin2018stoodoutasamajorinstance,formingVodafoneIdeaLimitedwhichwas the largest telecom provider at that time. This merger aimed to support operational synergies and tackle severe competition from Reliance Jio. The 2019 merging of Disney and 21st Century Fox showcased how firms could leverageresourcesto enhancetheirstandinginthemarket.DisneyboughtFox’sfilmandtelevisionassets which helped bolster its content library and boosted its position in the streaming wars with competitors like Disney+. Theseexamplesillustratehowmergersareemployedforovercomingchallenginggrowthmarkets.

b. Demergers

A demerger occurs when one company splits into one or more new companies to improve operations, focus on core competencies, or unlock shareholder value. In India, the demerger of Jio Platforms by Reliance Industries Limited separated its telecom and digital services from its conventional oil and gas operations which allowed focusedgrowthintechnology.SeparationofeBayandPayPalin2015servesasaglobalexampletoo,asitallowed eBaytofunctionpurelyasanonlineshoppingsitewhilelettingPayPaloperateindependentlyasaleaderindigital payments. These examples show how demergers assist businesses in altering strategies, improving operational focus,andincreasingreturnsforstakeholdersbyformingspecializedentities.

c. Exits:

Anexitstrategydescribesaplanwhereparticipantslikefoundersorinvestorsplantoliquidatetheirinterestsina business through an acquisition, IPO, or buyout. When Flipkart was partially bought by Walmart in 2018, it permitteditsfounderstoexitsinceWalmartboughta77%stakefor$16billion.ThismarkedoneofthelargestecommerceexitsinIndia'shistory.Onaglobalscale,Facebook(nowMeta)purchasedWhatsAppfor$19billionin

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2014whichofferedabundantreturnstoWhatsApp’searlyinvestorsandfounders.Theseexampleshighlight how well-thought-out exits can maximize shareholder value while enabling sponsored growth for the company with newownership.

2. Mergers

A merger is a strategic corporate decision where two or more entities combine into one singular organization. The unificationattemptusuallyseeks toachieveoperational effectiveness,increase marketpresence,attaina competitive edge,orpoolassetstogether.Therearevariousformsofclassificationforthesekindsofmergersbasedonthenature ofthefirmsinvolvedandtheirrelationshipwithoneanother.

 Horizontal mergers: It involves firm consolidation from within the same industry for deflationary competitionpurposes(CocaColamergingwithPepsi).

 Verticalmergers:Theseoccurwhencompaniesinasupplychainworktogethertoimproveefficiency(e.g., anautomobilemanufacturermergingwithapartssupplier).

 Conglomerate mergers: Here, firms from different sectors join forces to spread risk (e.g., a food organizationmergingwithatechnologycompany).

a. BenefitsofMergers:

 A merger is experienced when companies reduce their operational costs by sharing resources such as infrastructure, marketing, research, and advertising, submitting them for streamlined collaborative structures,decreasingexpenditureandimprovingproductivity.

 Mergeropportunitiesgrantcompaniesthecapabilitytopenetratenewmarketsorcustomerbasesenabling thoroughexpansioninservicesoffered.

 Elimination or incapacitation of competition bolsters a company's standing in the market enhancing its presencefurtherpromotingvisibility,strengtheningreputation,andsubsequentlyperformance.

 Improved innovation and healthy competition through merger usage of one another's technological expertise and insights allow businesses to draw creative solutions together and make technologically progressiveadvancementswhilstfollowingindustrystandardsandwithoutcompromisingcompetitiveness.

b. DifficultiesinMergers:

Asidefrompotentialbenefits,mergersalsoposechallengessuchascultureintegration,regulatoryinspection,or evenlayoffs.Forinstance,stafffromthemergingcompaniesmayhavedoubtsabouttheirroles,andtheremaybe imposedrestrictionstopreventmonopolisticbehaviour.

Mergersare powerful strategictools thatcantransform entire industriesasmentionedpreviouslyinthepaper. However, they do require comprehensive strategies before, during, and after the merger integration to realize theirfullpossiblevalue.

3. Difference between Mergers and Acquisitions

Bothamergerandanacquisitionrepresentformsofcorporaterestructuring;however,theydiffergreatlyinstructure, leadershipgovernance,andoutcomes.Amergeriswhentwoorganizationsofroughlyequalstatureandmarketpower joinforcestocreateanewsingleorganizationasoneentity.Insuchcasesownershipandcontroltendtobecomemore diffused and the new entity may opt for a name change or choose to retain one of the existing names depending on mutual agreement. OneexamplewouldbeHDFCLtd.’s merger withHDFCBank whichresulted ina largerdiversified financialinstitution.

An acquisition occurs when one company obtains complete control over a subsidiary or another company, thereby absorbingitfully.Theacquisitionturnsthepurchasedcompanyintoadivisionoftheacquiringcompany.Thereisno shared ownership since the acquiring company possesses total ownership and decides on all operational policies. A notableexampleisTataGroup'sacquisitionofAirIndia.Inthiscase,AirIndiacontinuesoperationsunderitsbrandfor purposesofrecognitionbutiscompletelyownedandmanagedbyTataGroup.

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Fromafinancialstandpoint,theassetsandoutstandingdebtsgetpooledtogether,thefirmswipetheoldstockoutand oftentradeitfornewshares.Inaclear-cutacquisition,onecompanysimplybuysanother-usingcash,offeringitsown stock,orraisingdebt-thentakesthewheelbyclaimingallstrategicsay-so.Becausethebuyerusuallypaysmorethan the market price, the target's assets and debts come in at that premium, riding alongside what accountants label goodwill onthe balancesheet. Thatextra pricetagismeant toaccountforpromisedcostsavings,newcustomers,or any hidden strengths the target might bring. The rule books are different for each: in a merger, management often prepares consolidated statements and premeasures equity, while in an acquisition the new unit sits under purchase accounting from day one. Tax wrinkles show up, too; if a merger trades only shares, taxes may stay asleep, yet an acquisition can wake up capital gains and at the same time let the buyer grab fresh depreciation and interest writeoffs. Where risks land also splits, in a merger, both sides shoulder the load, but after an acquisition, the purchasing firmfeelsthebulkofthefinancialandday-to-dayheadaches.Return profilesreflect thosechoices:ina merger, gains spread evenly over both camps, yet in an acquisition early winners can deliver outsized rewards to the owner who pulledthetrigger.

4. Demergers

A demerger is when a company splits into two or more separate firms. Dissimilar to mergers, which combine companies, demergers enable each new entity to focus on specific operations, strategies, or markets. These strategic moves are made to unlock shareholder value, enhance operational focus, and achieve better resource distribution. Theycantaketheformofspin-offswhereanewcompanyisformedandsharesaregivenoutto currentshareholders ordivestitureswhereonepartissoldoffandboughtbyanothercompany.

a. KeyBenefitsofDemerger:

 Increased Focus: Each organization can focus on a specific branch of the business ensuring optimized strategiesanddecision-makingtailoredforthatarea.

 Enhanced Value: Investors may perceive these businesses as having more value individually than if they werebundledtogetherinaconglomerate.

 Greater Efficiency: Separation allows organizations to streamline operations free from inefficiencies due to conflictinggoalswithintheparentorganization.

 Better Transparency:Separate entitiesenhance reportingstructuresleading to bettervisibilityonfinancial outcomesandgrowth.

 EnhancedCapitalDistribution:Postdemerger,bothfirmscanbetterfocusandtargetresourcestotheirmore criticalandexpansion-focusedareas.

b. DifficultiesinDivestitures:

 Strategicspinoffsarenoteasyundertakingsforacompany;theycomewiththeirownsetofchallenges.

 Startup Expenses: The legal, logistical, marketing, and generally operational business rifts have the extensivepotentialtobepriceybecauseofrestructuringprocesses.

 MarketPerception:Whenafirmdecidestopartwaysorunbundleitselffromthemothercompany,itmay sendwrongsignalsabouttheoverallperceptionandcredibilityofitsmergerasawhole.

 OperationalRisks:Craftingidentityoutsidetheumbrellabrandingdoescreatenewriskswhichstemfrom creatingindependentsystems,processesandnicknames.

 Staff Concerns: The fears surrounding existential dread one faces when considering headcount streams createsconfusionaboutleadershipstructurerelativetostabilitybeforeoraftersaidsplits.

 Importance of Strategy: Demergers often represent a long-term strategic vision, leading organizations to respondtochangingmarketconditions,regulatorychanges,ortechnologicaladvancement. Demergersare particularly beneficial when companies with varying opportunities for growth and objectives would be betteroffandoperatebetteriftheywereseparate.

In the corporate world, breaking up can be just as deliberate as coming together. It often involves a series of calculatedstepstoensurethatboththeparentcompanyandtheseparatedentitylandontheirfeet.Below arethe mostcommonpathscompaniestakewhenoptingtopartways:

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Spin-Off:Aspin-offislessaboutmakingastatementandmoreaquietrepositioning.Theparentcompanysimply handsoversharesofa new, standalone businesstoitsexistingshareholders-noIPO, nosale,no external buyers, justacleanbreak.(Example:PayPal’sSpin-OfffromeBayin2015 Thoughthetwohadbeeninoperationtogether since eBay purchased PayPal in 2002, market dynamics had changed. Activist investors and analysts contended that PayPal’s growth potential-particularly in the booming digital payments space-was being impeded by eBay’s slower e-commerce model. The spin-off allowed PayPal to pursue its own strategy, form alliances even with eBay’scompetitors(likeAmazon),andtapintomobilepaymenttrendswithoutrestrictions.Bothfirmsprospered afterthespin-off:PayPal’smarketcapeventuallyfarexceededeBay’s,validatingthesplit.)

Equity Carve-Out: Imagine wanting to test the waters before fully letting go. That’s where an equity carve-out comes into play. The parent company sells a minority stake in a subsidiary through an IPO, generating capital while retaining control. (Example: Prudential PLC completed the demerger of Jackson Financial, its U.S.-focused life insurance business, in 2021. The process involved an equity carve-out via IPO and a subsequent demerger. The move allowed Prudential to focus on high-growth markets in Asia and Africa, while Jackson operated independentlyintheU.S.)

Split-Off: This is the boardroom’s way of drawing a clear line in the sand. Shareholders are given the option to exchange their shares in the parent company for shares in the demerged entity, creating separate ownership structures.(Example:MetLife’ssplit-offofBrighthouseFinancial.)

Divestiture (Sell-Off):Inadivestiture,theparentcompanysellsoffanentirebusinessunit,subsidiary,orassetto another company or investor-often to refocus or raise capital for higher-growth opportunities. (A classic case: Nestlé’s $2.8 billion sale of its U.S. candy division to Ferrero in 2018. The divestiture included well-established brands like Butterfinger, BabyRuth, and Nerds. The division allowed Nestlé to pivot toward healthier product segments.)

5. Exits

An exit, is the process whereby business owners, founders or investors exit, divest or liquidate their interest in a company.Exitingabusinessistypicallydonetorealizeprofit,andpotentiallytopursueotheropportunities.Exitsare an important part of the business lifecycle and in particular of the life of a start-up or investors seeking to realize a return on their investment. Organizations or stakeholders may choose to exit for a of reasons, including financial objectives,marketconditionsorsimplyastrategicdecisiontopassthebusinesstoanewgoverningbody.

a. TypesofExitStrategies

 Acquisition: Firm A is acquired by Firm B, usually for strategic purposes such as expanding the geographical footprint in insourcing (e.g. buying your supplier), executing timely market entry, or acquiringtechnology(e.g.afirmdevelopingacomplimentaryinvention).

 Initial Public Offering (IPO): A firm goes public through an IPO of equity, allowing a stakeholder to sell theirownershipstaketothegeneralpublic.

 Management Buyout (MBO): Current firm's management purchases the firm, often with support from investorsorfinancialinstitutions.

 Consolidation with a Larger Firm: When two firms become a single entity with a larger organization usuallyaspartofastrategicmerger.

 PrivateSale:Whenabusinessissoldtoaprivatebuyer,usuallyinsecretandusuallywithabuyerwhois acompetitor,financierorstrategicpartner.

b. KeyBenefitstoExits

 ValueRecognition:Exitsprovideamechanismforstakeholderstoexitandcapturevalue.

 Strategic Change: Exits provide a firm with an opportunity to transition to a new owner/or toward a newstrategywithamorecompetentorresourcerichorganization.

 Reduced Risk: Entrepreneurs/Investors can reduce risks and exit at the right time (tricky in volatile markets).

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 Market Trends Opportunities: Exiting/Opening opportunities during market trend shifts, or attracting investorsattherighttime.

Keydeterminantsinclude:

 Control and Ownership Transfer:Ownersmustdecidewhethertoretainpartialinvolvementorfullydivest.

 Business Performance and Growth Outlook: Profitability, market positioning, and scalability influence viable exitoptions.

 Investor and Shareholder Interests: The number and type of stakeholders exiting can affect deal structure and complexity.

 Exit Timeline: Whether an exit is planned over an extended period or executed rapidly affects the strategy selection.

 Reputation and Legacy Considerations

 Financial Priorities: Owners must evaluate whether their priority is maximizing immediate returns, ensuring long-termfinancialsecurity,oroptimizingtaxefficiency.

6. Other Key Terms

1. Initial Public Offering (IPO):AnInitialPublicOffering,orIPO,signalsafirm’sleapfromprivatelifeintothe open market, letting everyday investors buy its shares for the very first time. Through this event, a business gathers freshcapitalthatcanfuelgrowth,whileearlybackersfinallygetaclearexitstrategyandsomeliquidity.Yetalong withbenefits-suchaswidervisibility,greatertrust,andsubstantialcashthatpaysfornewprojects-cometougher rules,constantreporting,andtheficklemoodswingsofpublictraders.

InSeptember2023ArmHoldingsPlcpulledoffoneoftheyearsmarqueetechlistings,bringingin$4.87billionby floating 95.5 million American Depositary Shares at $51 apiece. That deal became the biggest venture-capitalbackedIPOof2023andsetArm’smarketvaluenear$54.5billiononafully-dilutedbasis.

2. Management Buyout (MBO): AManagementBuyout,orMBO,happenswhenthepeoplewhorunacompanystep in and buy that business from its current owners. Groups often take this route when they want to sell off a noncoreunitorwhenkeepingthesameteaminchargeisabsolutelycritical.Thedealkeepsoperationssteady,aligns managersfinancially,andshieldssensitivetalksfrompublicview,yetitleanssoheavilyonborrowedmoneythat sparecashafterwardisusuallyscarce.

In 2013, Dell's founder Michael Dell joined forces with Silver Lake Partners, secured a $2 billion pledge from Microsoft,andsteereda$24.4billionMBOthattookthecompanyprivate.

3. Employee Stock Ownership Plans (ESOPs): AnEmployeeStockOwnershipPlan(ESOP)isaretirementprogram thatletsworkersgraduallybuysharesinthecompany,usuallywithsomehelpfultaxbreaks.Founderswhowant torewardlong-timestaffandstillfreeupcashoftenuseESOPsaspartofabiggerexitplan.

In October 2023 CFD Research, a Huntsville, Alabama, company, made the leap and became 100-percent employee-ownedthroughanESOP.

4. Strategic Sale: A strategic sale involves selling the company to a competitor, supplier, or partner that perceives untappedpotentialintheacquisition,andisoftenwillingtopayapremiumtomakeittheirs.Thisstrategyisoften pursuedwhenthebuyercanextractgreatervaluefromthetargetcompanythanstandaloneoperations.

TakeNuanceCommunications,forexample-its$19.7billionsaletoMicrosoftin2021letitbenefitfromMicrosoft’s abilityto scaleitsAI-driven healthcaresolutionsglobally.Farfroma concession,the deal deliveredscale,capital, andawelltimedexit.

5. Liquidation: Liquidation involves winding down a company’s operations and distributing its assets to creditors andshareholders,typicallypursuedwhenthecompanyisinsolventornolongerviable.

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In April 2023, the U.S. home goods giant Bed Bath & Beyond filed for Chapter 11 bankruptcy, overwhelmed by mounting debt and plunging sales. What followed was a rapid descent-store closures, liquidation sales, and the endofaneraforaonce-dominantretailname.

7. Examples of Mergers, Demergers, and Exits

 MergersInIndia:

1. Vodafone India and Idea Cellular (2018): Vodafone Idea Limited was created by the merger of Vodafone IndiaandIdeaCellular,tobecomeIndia'slargesttelecomoperatoratthattime.Themergerwastriggered by the arrival of Reliance Jio and the increased competition in the industry due to their low priced services.

2. State Bank of India and Associates Banks (2017): SBI's merger with four regional banks in India- State Bank of Patiala, State Bank of Travancore, State Bank of Mysore, State Bank of Bikaner and Jaipur, and BharatiyaMahilaBank-wasinthepursuitofcreatingalargerbank withenhancedoperationalefficiency, capabilitytohavelargershareinthefinancialmarketandtoreachmorecustomers.

VodafoneIdea BhartiAirtel

Rcom-Aircel-Sistema BSNL/MTNL

Rjib Tata

Others

Fig1:MarketShareofMajorTelecomCompaniesinIndia

RevenueMarketShare

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SubscribersMarketShare

VodafoneIdea BhartiAirtel

Rcom-Aircel-Sistema BSNL/MTNL

Rjib Tata

Others

 WorldwideMergers:

1. Disneyand21stCenturyFox(2019):Disneyacquired21stCenturyFoxforapriceof$71billion,and theybroughttogethertheirentertainmentassetsto solidifyDisney'splaceinthestreamingindustry withDisney+.

2. Exxon and Mobil (1999): This merger was with two oil companies forming ExxonMobil, one of the largest publicly traded energy companies in the world. ExxonMobil used the merger to leverage synergiesintheoilandgasmarket.

 IndiaDemergers:

1. Reliance Industries: Jio Platforms (2019): Reliance Industries demerged its telecom and digital businesses into Jio Platforms to give focus to its growth in the telecom and technology space, while allowingtheparententitytofocusonitstraditionaloilandgasbusiness.

2. Larsen&Toubro(L&T):DemergerofL&TFinance(2011):L&Tdemergeditsfinancialservicesarmof L&TFinancewhichbecame anindependent companyandovertimegrewtobe morerelevantinthe financialservicesspace.

 WorldwideDemergers:

1. eBay and PayPal (2015): eBay spun off PayPal into a stand-alone business and eventually gave both businessestheopportunity tofocus theirrelativemarkets,witheBayfalling nowunder e-commerce whilePayPalondigitalpayments.

2. Siemens AG - Healthcare Division (2018): Siemens demerged Siemens Healthineers, taking its healthcaredivisionpublic,inordertoincentivizeinnovationinmedicaltechnologyanddiagnostics.

Fig2:SubscriberMarketShareofMajorTelecomCompaniesinIndia

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PayPalcontributes38%toeBay'srevenue

 ExitsViaIndia:

1. Flipkart - Walmart's Partnership (2018): Walmart's $16 billion acquisition of a 77% stake in Flipkart resultedinanexitforFlipkart'sexistinginvestorssuchasTigerGlobal,SoftBank,Accelas wellasforcofounderSachinBansal.

2. Ola Electric - SoftBank's Partial Exit (2021): SoftBank had a partial exit from Ola Electric when the companyraisednewfundsusinga$3billionvaluation,enablingtheinvestortomonetizeprofit.  ExitsViaWorldwide:

1. WhatsApp - Facebook's Acquisition (2014): Facebook's acquisition of WhatsApp for $19 billion was a hugeexitforitsfoundersandthecompany'sinvestorssuchasSequoiaCapital.

2. Instagram - Facebook'sAcquisition (2012):Facebook's acquisition of Instagram for $1 billion wasalsoa bigexitforitsfoundersKevinSystromandMikeKriegerjusttwoyearsafterlaunchingtheplatform.

These examples identify and highlight the fact that mergers, demergers and exits can change businesses and marketswithlong-termimplicationsforstakeholders,industries,andeconomies.

Fig3:PayPal’srevenuecontributiontoeBayglobally

EbayRemainingRevenue(inbillionUSD) PayPalRevenue (inbillionUSD)

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ValuePerUser,basedonMarketCapitalizationorAcquisition Price(inUSD)

ThecompletedmergerofHDFCLtd.andHDFCBank,occurringon1July2023,isthe largestcorporatemergerinIndia and one of the largest in the world. The all-share transaction, representing a value of approximately ₹ 3.6 lakh crore, involvedthemergerofHDFCLtd.-thelargesthousingfinancecompanyinIndia-intoHDFCBank,itsbankingsubsidiary. Themergerwastoformanewfinancialbehemothwithamuchlargerbalancesheet,greatercustomerreach,andmore productstooffer,specificallyintheareasofhousingandretailbanking.ThemergerincreasedHDFCBank'stotalassets and customer base; however, the lending portfolio of HDFC Ltd. was large and had a greater lending portfolio than deposits, which initially pushed the loan-to-deposit ratio (LDR) into excess of 110%. Over the next few quarters, the bankfocusedondepositramp-upwhichbroughttheLDRsteadilydowntoapproximately96.5%inMarch2025,witha longer-term target of 85-90% by FY 2026-27. The Reserve Bank of India classified the new entity as a Domestic Systemically Important Bank (D-SIB), which means that it is regarded as highly important to the functioning of the financial system. The merger gives customers and investors more service opportunities, operational efficiencies, and long-termgrowthopportunitiesinIndia'srapidlychangingbankinglandscape.

Keypoints:

 Effective Date:July1,2023

 Deal Value:₹3.6lakhcrore(approx.$40billion)

 Share Swap Ratio:42sharesofHDFCBankforevery25sharesofHDFCLtd

 Merged Entity: HDFC Ltd merged into HDFC Bank, forming one of the largest banks globally by market capitalization

 Loan-to-Deposit Ratio (LDR):Initiallyrose to ~ 110% post-merger due toloan-heavybalance sheet from HDFC Ltd

 Current LDR:Reducedto~96.5%asofMarch2025

 Target LDR:85-90%byFY2026-27

 Customer Base:Over120millioncustomersafterintegration

 RBI Designation:ClassifiedasaDomesticSystemicallyImportantBank(D-SIB)

 Operational Benefits: Expanded product portfolio, deeper reach in housing finance, and improved cross-selling potential

 HDFC Ltd Status:DelistedandfullyintegratedintoHDFCBank

Fig4:ValuePerUserorAcquisitionPriceofMajorTechGiants

8. HDFC Ltd. and HDFC Bank Merger

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9. Air India and Vistara Merger

TheTataGroupsuccessfullyacquiredVistarainfullandsubsequentlyabsorbeditintoAirIndiaon12November2024, marking a major consolidation in Indian aviation. Vistara, which was previously a joint venture between Tata Sons (51%)andSingaporeAirlines(49%),ceasedindependentoperationsandallofthebusiness-fleet,staffandroutes-was integratedintoAirIndia.Aftertheacquisition,SingaporeAirlinesnowownsa25.1%interestintheenlargedAirIndia. This acquisition is part of Tata's larger idea to rationalize its aviation ventures and create a world-class, global competitorairlinebasedinIndia.

Keypoints:

 Deal Announced:November2022

 CCI Approval:September2023

 NCLT Approval:June2024

 Acquisition Completed:12November2024

 Vistara Brand Retired:AlloperationsnowunderAirIndia

 Singapore Airlines Stake:25.1%inmergedAirIndia,witha₹3,194croreinvestment

 Fleet Size Post-Acquisition:Over210aircraft,includingAirbusA320/A321andBoeing787

 Workforce Integration:Over5,000Vistaraemployeesabsorbed

 Loyalty Program:ClubVistaramergedintoAirIndia’sFlyingReturns(nowcalledMaharajaClub)

 Flight Code Change:Vistara’s'UK'flightcodesreplacedwith'AI2xxx'underAirIndia

 Customer Impact:

o Unifiedticketing,loyaltybenefits,andbranding

o Enhanceddomesticandinternationalconnectivity

10. Tata Motors Demergers

Tata Motors is undertaking a major corporate restructuring with the demerger of its company operations into two independentlylistedcompanies:

- TataMotorsCommercialVehiclesLtd(TMLCV)-willrunthecommercialvehicles(CV)operations - MotorsPassengerVehiclesLtd(TMPV) -willrunthepassengervehicles(PV)includingelectricvehicles(EVs) andJaguarLandRover(JLR)

On1August2024,theboardapprovedthedemerger,andon6May2025,shareholdersapproveditwithoverwhelming support. The demerger is expected to be completed by mid-FY2025–26 (approximately September 2025) through a scheme of arrangement with NCLT approval. Shareholders will hold the same percentage interests in both new companies.

1. StructureoftheDemerger

 Two separate listed companies: TMLCV - Commercial Vehicles (trucks, buses, etc.) TMPV - Passenger Vehicles(cars,EVs)andJLR

2. Timeline

 BoardApproval:August2024

 ShareholderApproval:May2025(99.9995%infavour)

 EstimatedCompletion:Mid-FY2025–26(approx.September2025)

3. Shareholding

 TheshareholdersofTataMotorswillgetequalshareholdingsinbothcompanies.

 Therewillbenocashtransactionmadeandnochangeinownershipstructure.

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4. Rationale

 Allows each of the businesses to implement focused strategies, attract investors with segments, and optimallycreatevalue.

 Helpsreducecomplexitywherebusinesseshavedifferentcapitalneeds,customers,andgrowthprofiles.

 JLRandEVbusinessescanhelpgrowTMPV,withoutthelegacybungofthecapital-intensiveCVbusiness.

5. MarketReaction

 TataMotors'sharepriceincreasedby~7%aftertheannouncementinearly2024.

 MorganStanley,Nomura,andJPMorganAnalystwerepositive,seeingpotentialforvalue-unlocking.

 UBSwasmorecautionaryinitsview,andsawlimitedshorttermimpact.

6. OperationalReadiness

 CVandPVbusinesseshavebeenindependentlyoperatedsince2021.

 Thedemergerisafurtherextensionofthisindependencetoimproveagilityandcapitalefficiency.

11. Calculations:

a. RevenueofHDFCBankinIndia:

Inthegraphbelow,x-axisrepresentsyears(from2015to2025)andy-axisshowsrevenueofHDFCbank(inUSD milliondollars)

Let’sconsider2015as1,2016as2 and2025as11

Aftermanuallydrawing the graphon excel,weconclude thatexponential equationcovers the maximumnumber ofplots

HDFCBank'sRevenue(inUSDMillionDollars)

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b. AirIndiaRevenueinIndia:

Inthegraphbelow,x-axisrepresentsyears(from2015to2025)andy-axisshowsrevenueofAirIndia(in100Cr. rupees).

Let’sconsider2015as1,2016as2 and2025as11.

Aftermanuallydrawingthegraphonexcel,weconcludethatbiquadraticequationcoversthemaximumnumberof plots

Consideringy=Ax4+Bx3+Cx2+Dx+E

Formula: y = 0.02736*x4 - 0.428*x3 + 1.851*x2 - 1.137*x + 19.4 where‘y’istherevenueofAirIndia(inRs100Cr.), and‘x’represents1,2,3……(1representing2015,2representing2016andsoon).

c. TataMotorsPassengers:

Inthegraphbelow,x-axisrepresentsyears(from2015to2025)andy-axisshowsTataMotorsPassengers(inlakh crores).

Let’sconsider2015as1,2016as2 and2025as11.

Aftermanuallydrawingthegraphonexcel,weconcludethatcubicequationcoversthemaximumnumberofplots

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Volume: 12 Issue: 06 | Jun 2025 www.irjet.net p-ISSN:2395-0072

TataMotorsPassangers(inlakhcrores)

Formula: y = 0.0127*x3 - 0.206*x2 + 0.989*x + 1.43

where‘y’isTataMotorsPassengers(inlakhcrores), and‘x’represents1,2,3……(1representing2015,2representing2016andsoon).

12. Conclusion:

ThecasestudyofAirIndia,HDFCBankandTataMotorsdemonstrateshowdifferentformsofcorporaterestructuringmergers,acquisitions,anddemergers-strategicallyrepositioncompaniesforgrowth,specialization,andsustainability. ThesurgeinAirIndia’srevenuesafteritsacquisitionbyTataGroupservesasacaseinpointontheimpactofstrategic ownership transformation brought about by effective management and ample financial backing. On the other hand, the biquadratic trend that is visible in HDFC Bank’s revenue chart captures the very complex yet gradual process of value creation from one of the largest mergers in India’s banking history along with short-term gains as well as significantgrowthpotentialassociatedwithit.

Meanwhile, the observed cubic growth trend of Tata Motors passenger vehicle segment post demerger illustrates anotherphenomenonconcerningspecializedbusinessunits.Grantingautonomytopassengerandcommercialvehicle divisionsallowedthefirmtoachievefocusedgrowthalongsidetransparencyinoperations which enhancedspeedto respondtocompetitiondrivenwithinthisfast-pacedindustry.

These adaptations demonstrate how companies undergo structural changes in response to the economy’s current state and strive to optimize its efficiency, unearth hidden value, manage the organization with greater focus or streamline synergies. While growth and expansion are usually associated only with mergers and acquisitions, demergersnormallyfosterinnovationbysharpeningfocusonanentity'scorecompetencies.

“The best way to predict the future,” as coined by Peter Drucker, “is to create it." Therefore, within this context of industries and economies, mergers, demergers or acquisitions should be viewed more holistically as powerful economy-shapinginstrumentsratherthanmerelyfinancialtransactions.

13. Bibliography:

1. Air India. (2023). Annual Financial Report 2022–23. Ministry of Civil Aviation, Government of India. Retrieved fromhttps://www.airindia.in

International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056

Volume: 12 Issue: 06 | Jun 2025 www.irjet.net p-ISSN:2395-0072

2. Business Today. (2023). Explained: Tata Motors’ Demerger Strategy and What It Means for Investors. Retrieved fromhttps://www.businesstoday.in

3. CNBC-TV18. (2023). HDFC–HDFC Bank Merger Explained: All You Need to Know. Retrieved from https://www.cnbctv18.com

4. Economic Times. (2022). Tata Group Completes Acquisition of Air India. The Times Group. Retrieved from https://economictimes.indiatimes.com

5. HDFC Bank. (2023). Investor Presentation:HDFC Ltd - HDFC Bank Merger Overview.HDFCBankLimited.Retrieved fromhttps://www.hdfcbank.com

6. Ministry of Corporate Affairs. (2022). Corporate Restructuring andM&A Guidelines inIndia.GovernmentofIndia. Retrievedfromhttps://www.mca.gov.in

7. Moneycontrol. (2023). Major Mergers and Acquisitions in India: Vodafone–Idea, SBI Merger, and More. Retrieved fromhttps://www.moneycontrol.com

8. PwC India. (2023). The Evolution of Mergers and Acquisitions in India: Trends and Outlook PricewaterhouseCoopers.Retrievedfromhttps://www.pwc.in

9. RBI. (2023). Report on Trends and Progress of Banking in India 2022–23. Reserve Bank of India. Retrieved from https://www.rbi.org.in

10. ResearchGate. (2017). Vodafone–Idea Merger Chart. Retrieved from https://www.researchgate.net/figure/Showing-Vodafone-Idea-Merger-13_fig11_319423834

11. Statista. (2014). Facebook Paid $42 Per WhatsApp User. Retrieved from https://www.statista.com/chart/1934/facebook-paid-42-dollars-per-whatsapp-user/

12. Statista. (2015). eBay vs PayPal Turnover Comparison. Retrieved from https://www.statista.com/chart/441/turnover-paypal-ebay/

13. Tata Motors. (2023). Annual Report 2022–23: Business Reorganization and Demerger Updates. Tata Group. Retrievedfromhttps://www.tatamotors.com

14. The Hindu Business Line. (2023). HDFC–HDFC Bank Merger: What It Means for Indian Banking. Retrieved from https://www.thehindubusinessline.com

15. Venture Intelligence. (2023). M&A Deals Report: India 2023. Retrieved from https://www.ventureintelligence.com

16. World Bank. (2023). Ease of Doing Business in India: Impact of Structural Reforms. Retrieved from https://www.worldbank.org

14. Biography:

Angel Jain

- HeadGirl,academicyear2024-25;responsible forstudent leadership,eventcoordination,andschool representation

- Academicscores:97.01% (Grade9),98.4%(Grade10,CBSEBoard,SchoolTopper), 96%(Grade 11);earning merit distinctionsinall majorsubjects

- DistrictRank 1 - SOFMathematicsandScience Olympiads; RegionalRankHolder - InternationalFinance Olympiad(2023-2024)

- Winner - BITS PilaniHyderabadBusinessPitchCompetition(All-India);Top350International Finalist - Blue OceanEntrepreneurship Competition

- Founder - FinanceClubfor teenagers:conductedpeer-ledsessionsonbudgeting,saving, credit,investing,and entrepreneurship

- Internship - CharteredAccountantFirm (1+ month):exposuretoauditing, documentation,financialcompliance; Internship - underPortfolio Analyst&InvestmentExpert(1+month):observatory role inclientprofiling, portfolioplanning, investmentresearch

International Research Journal of Engineering and Technology (IRJET) e-ISSN:2395-0056

Volume: 12 Issue: 06 | Jun 2025 www.irjet.net p-ISSN:2395-0072

- BestDelegate - MultipleModel UnitedNations(MUNs);National Parliamentary Debate Champion; WinnerDeclamations,Mock Parliaments,QuizCompetitions

- Co-author - LiteraryAnthology (ISBN:978-93-5452-453-0):contributedoriginalwork;Editor - SchoolMagazine: managedlayout,solicitedentries,edited/proofedfullpublication

Under the guidance of:

Dr. Mamta Jain

- M.Sc. (Mathematics)(Double GoldMedalist)

- M.Phil.(Computer Applications)with Honours from UniversityofRoorkee (nowIITRoorkee)

- PhD(Mathematics)

- Variouspaperspublishedininternational journals.

- Former LeadAuditorISO9001,ISO -22000SchoolAccreditationExaminer byQCI

- 26yearsofteachingexperience

Er. Raunaq Jain

- B.EMechanicalEngineeringFromThaparInstitute ofEngineeringandTechnology

- SchoolPhysicsTopper

- MechanicalMentor forsession2019-2020

- TechnicalData AnalystatDeloitte

- Multiple researchpaperspublished