If bidding and target firms are strategically related, then the economic value of these two firms combined is greater than their economic value as separate entities.

Question

Quizplus · Accepted Answer

If the bidding and target firms are strategically related, then combining their resources, capabilities, and market positions can result in greater efficiencies, synergies, and market power, leading to increased economic value as compared to their separate entities. This is known as the synergy effect, where the whole is greater than the sum of its parts. Therefore, the statement is true.

If Bidding and Target Firms Are Strategically Related, Then the Economic