Part I discusses the context in which mergers, acquisitions, and corporate restructuring occur, including factors often beyond the control of the participants in the M&A process. The three chapters comprising this section of the book provide an overview of M&A, a discussion of important regulations impacting M&A, and common M&A strategies.

Chapter 1 addresses the basic vocabulary of mergers and acquisitions, the most common reasons why M&As happen, and how such transactions occur in a series of somewhat predictable waves. Alternatives to M&As and participants in the M&A process, from investment bankers to lenders to regulatory authorities, are discussed in detail. The chapter also discusses whether M&As benefit shareholders, bondholders, and society, with conclusions based on the most recent empirical studies. The tangle of regulations that impact the M&A process are covered in Chapter 2, including recent changes in US federal and state securities and antitrust laws as well as environmental, labor, and benefit laws that add to the increasing complexity of completing deals. The implications of cross-border transactions, which offer an entirely new set of regulatory challenges, also are explored here and elsewhere in this book in the setting in which they commonly occur.

Viewed in the context of a market in which control transfers from sellers to buyers, Chapter 3 addresses common takeover tactics employed as part of an overall bidding strategy, the motivation behind such tactics, and the defences used by target firms to deter or delay such tactics. Bidding strategies are discussed for both friendly and unwanted or hostile business takeovers. In hostile deals, the corporate takeover is viewed as a means of disciplining underperforming management, improving corporate governance practices, and reallocating assets to those who can use them more effectively. This chapter also addresses the growing role activists are taking in promoting good corporate governance and in disciplining incompetent or entrenched managers.

The reader is encouraged to review deals currently in the news and to identify the takeover tactics and defences employed by the parties to the transactions and to describe their intended purpose. One’s understanding of the material can be enriched by attempting to discern the intentions of both the acquiring and target firms’ boards and management, if the proposed business combination makes sense, and by thinking about what you might have done differently if you had been a member of the acquirer's and target's board.