Evaluation of M&A Effects in Japanese Shipping Companies : Case Study of NYK & Showa Line and OSK & Navix Line

In shipping industries, M&A (Mergers and Acquisitions) has been brisk around large shipping companies since the mid to late 1990s. M&A strategy has attracted a lot of attention recently as a plan to improve profitability of shipping companies and to streamline their management, due to shipping economic depression. In this situation, it is necessary to plan strategies to evaluate properly M&A effects of shipping companies and to achieve successful M&A. This study aims to investigate the backgrounds and purposes of M&A in Japanese shipping companies and evaluate M&A effects from long-term business performance analysis and synergy effects analysis, using EVA (Economic Value Added). The cases in the study verified the rise of market power and turnover. The companies accomplished the improvement of their financial safety and profitability through the mergers. And, the cases imply that positive synergy effects are able to be created by effective utilization of managerial resources and investing activities in post-merger.