Questioning the Efficiency and Efficacy of Amalgamation for Small and Medium Sized Enterprises under Cameroonian Law

Abstract

Given globalization and regional integration tendencies, a chain of economic interdependence between countries has been on the rise in recent decades. Small and medium sized enterprises are no exception; as they make up over 70% of the world’s economy. In recent times, SMEs attention is greatly tilting; as they tend to consider merging to rekindle their fate in the economic scene. But it seems so difficult for SMEs to successfully undergo an amalgamation process most especially in an economy like ours where necessary training, information, and policies are practically inefficient. What even makes things worst is the nature of this type of enterprise in itself wherein owners and or managers always lack the necessary skills making it more complex in a seemingly wider structure. The challenge here begins right from choosing the right partner, through managing transition to branding and post-merger management. This piece reveals that, despite the goal of performance improvement, results from mergers and acquisitions (M&A) are often disappointing. Numerous empirical studies show high failure rates of M&A deals. Hence, it is recommended that merger and acquisition should be strategically and diligently be employed by firms to improve profitability, human resource personnel’s should have their place and government should create the enabling environment that can enhance merger and acquisition in Cameroon. Just more than enough is yet desired for the amalgamation process to be worth relying on in the Cameroonian economy.