Ansell Condoms Case Study Essay

Question 2: What are the pros and cons for Ansell acquiring a European competitor? In your opinion, is it a good idea? Pros Ansell will be able to get a greater share of the market in Europe. Acquiring a new company in Europe will help to build their portfolio. They should be able to increase their number of recognisable brands. Ansell will be able to acquire the new companies existing contracts and contacts. It will help to create a reduction of overcapacity in the industry. Increase sales/revenue. Cons It was mentioned that the companies that Ansell are thinking about taking over are in some financial difficulty at the moment so Ansell will have to take on that difficulty. There is an increased change of job cuts. It will be hard for Ansell so see all of the hidden liabilities the company may possess. Ansell will more than likely have to pay goodwill for the acquisition. Conclusion Overall in my opinion it would be a good idea for Ansell to try and acquire a European competitor because although there is some financial risk and it could be a difficult process I think that the pros that I mentioned above will outweigh the potential cons. Ansell will need to get a strategy in place to make sure that the takeover goes as smoothly as possible. Learning Points: * Condom market is extremely competitive This case study shows us that the condom market is extremely competitive with five main companies competing with each other and a large number of smaller companies continually trying to gain a greater market share. * Acquisition of European competitor good for Ansell It would be a good idea for Ansell to take over one of their smaller European competitors to try and increase their market share and increase their number of recognisable brands around the world.