They are companies that operate in more than one industry. Proctor and Gample is a good example...they do everything from diapers to food to cosmetics. G&E is another good example...they market everything from toasters to medical equipment.
2006-07-24 06:20:23
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answer #1
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answered by tkk0980 1
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Conglomerates were popular in the 1960s due to a combination of low interest rates and a repeating bear/bull market, which allowed the conglomerates to buy companies in leveraged buyouts, sometimes at temporarily deflated values. Famous examples of the 1960s conglomerators include Ling-Temco-Vought, ITT, Litton Industries, Textron, Teledyne, and Gulf and Western Industries. As long as the target company had profits greater than the interest on the loans, the overall return on investment (ROI) of the conglomerate appeared to grow.
Potenital advantage
To modern business analysts, the best argument for conglomerate organizational form is that it may allow capital to be allocated in a more efficient way. For example, a hypothetical conglomerate consists of a candy store and an internet website. Suppose the candy store has high cash flow, but very few profitable investment opportunities. The startup has low cash flow, but lots of good investment projects. By combining the businesses together, the cash from the candy store can be used to make profitable investments that would otherwise not be made in the web site. The main question associated with this strategy is why this improves upon a market-based allocation of capital. That is, if the entities were standalone, then presumably the investors in the candy store could receive dividends, and then reinvest those dividends in the startup. If this market-based mechanism works well, then all profitable internet startup investments can be made without having the two entities be under common ownership. Research suggests that financial markets may not always operate efficiently due to the presence of asymmetric information. If this problem is severe, then the common ownership of the assets might yield a more efficient allocation of capital
A large, diversified company with a wide array of businesses
in India there are Reliance group , Wadia group,Zee, Bajaj group,Dalmia group,Birla group and many more ..
even Hindustan Lever ccan be called as conglomerate as the operating arena is quite big..
2006-07-25 04:51:37
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answer #2
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answered by sanjubuddy 4
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In business usage, conglomerates are companies that include a number of diversified operations, such as telephone lines and hubs, business equipment, and cabling operations; or agricultural production, food processing plants, freight operations, and restaurant franchises.
Generally, a conglomerate is a bunch of things stuck together, so a conglomerate is a type of rock that has smaller grains or pebbles that have become stuck together by mineral deposits or heat and pressure, or perhaps a nutritious snack bar with granola, nuts, and fruit.
2006-07-24 13:23:01
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answer #3
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answered by dig4words 3
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Huge corporate houses with well diversification, huge volumes, wider market exposure - nationally or internationally or both; are called Conglomerates. Examples in Indian context are Tata sons, Birlas, Reliance, Bajaj, Wadias....
2006-07-25 03:04:28
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answer #4
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answered by helpaneed 7
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type that work in MS word, right click after the last letter, get a pull-down menu and go to 'synonyms' You see a whole list of similar meanings like multinational, corporate, firms, etc.
2006-07-25 10:13:13
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answer #5
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answered by easyboy 4
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a corporation that owns many companies.
2006-07-24 13:17:58
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answer #6
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answered by rweasel6 2
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