Impact Of Mergers And Acquisitions Of Tata Group - Free Essay Example

Sample details Pages: 15 Words: 4567 Downloads: 10 Date added: 2017/06/26 Category Statistics Essay Did you like this example? My experience in preparing the seminar paper on IMPACT OF MERGERS AND ACQUISITIONS ON THE FINANCIALS AND PERFORMANCE OF TATA GROUP has been a very knowledgeable and fulfilling experience for me. While learning a lot on finance field, I sincerely hope I have also been able to contribute positively to the paper. It is indeed a matter of great pleasure for me to express sincere gratitude to my Faculty Guide Mr. RC Agarwal for his support and encouragement at every stage of the training. I heartily thank the Head of Department, the Chairperson and the Dean for the continuous help and friendly atmosphere of education provided by them. Don’t waste time! Our writers will create an original "Impact Of Mergers And Acquisitions Of Tata Group" essay for you Create order In the current globalised economy, mergers and acquisitions are being progressively more used the world over, for increasing competitiveness of companies through gaining better market share, expansion of the portfolio to reduce business risk, to capitalize on the economies of scale and for entering new geographies, etc. This research study was intended to analyze the consequence of going global market through merger and acquisition and traders long and short term earnings .Thereby study the impact of mergers on the financials by examining some pre- merger and post-merger financial ratios, with the sample of firms chosen as three major mergers/acquisitions of TATA Group. The results put forward that there are small variations in terms of post merger financial performance of the joint firm is not considerably different from the aggregate performance of the acquirer and target companies before the merger. INRODUCTION Merger and acquisitions have emerged as chief forces in the contemporary financial and economic environment. They have been a source of corporate growth and in India, it has changed radically after the liberalization of Indian economy. Mergers and acquisitions came up as one of the most efficient methods of such corporate restructuring, and became an essential part of the long-term trade strategy of corporates in India. The sole three chief objectives at the back any MA transaction were found to be: à ¢Ã¢â€š ¬Ã‚ ¢ Improving Profitability à ¢Ã¢â€š ¬Ã‚ ¢ Rapid growth in scale and closer time to market à ¢Ã¢â€š ¬Ã‚ ¢ Acquirement of new technology Many in corporate India would be jealous of the Tata Groups strategy around mergers and acquisition. In the past 8 years, the Tata Group had made 35 overseas acquisitions, including coal and iron ore mines, adding up Rs 78,000 crore, mostly in the past 3 years. Research problem To examine the consequence of going global through mergers and acquisitions and the traders long term and short term earnings respectively. This would aid in studying the impact on companies financials past the merger or acquisition. To also determine the enterprise value of the corporation by comparing it with the peer group and studying the value of the firm Objective of the study To analyze the a thorough detailed case study of 3 companies of Tata Group who merged or acquired in the past years. To evaluate the closing price of 3 companies previous to and post acquisition To weigh up the key financial ratios of 3 companies pre and post acquisition To do valuation of two companies through enterprise value and contrast the value with peer group and examine in detail Review of literature The subsequent studies are the few existing work reviewed which were conducted by researchers in the sight of analyzing the financial performance during and post merger activity across different time periods. Effect of mergers on corporate performance in India, writer Mrs. Vardhana Pawaskar (2001), considered the impact of mergers on corporate performance. A case study, assessed the financial performance of a cloth unit by using ratio analysis. It compared the before and after merger performance of the corporations between 1992 and 2000 to identify their financial character. The study found that the financial fitness was never in the strong zone during the whole study period and ratio analysis highlighted that decision-making incompetence accounted for a good number of the problems. Forecasting the viability and operational efficiency by Mr Mulla through use of ratio analysis, suggested matching up efficiency and success of all facets of management and put the company on a lucrative footing. The study of a sample of firms, restructured through mergers, showed that the merging firms were at the inferior end in terms of liquidity of the industry. The merged firms gave better performance than industry in terms of profitability. Mergers and operating performance by Mr. Mantravadi: An Indian perspective, attempted to examine the impact of mergers on the performance post industrial reforms, by investigating some pre- and post-merger financial ratios, with chosen sample firms, and all mergers linking public and private limited companies The study results suggested that there are minor variations in terms of impact on financial performance of subsequent mergers across different intervals of time in India. It also indicated that for mergers between the same groups of companies in India, there has been deterioration in performance and ROI. Mergers acquisitions in the banking sector presents the Indian scenario, author Mr. Selvam (2007) has analyzed the impacts of stock price changes to mergers and acquisitions behavior taken place in banking industry with particular reference to private and public sector banks. Found that share prices are market sensitive. From the financial analysis it was noted that greater part of the banks went for branch extension and this has affected profitability to some extent and it resulted in harmful competition among the players. To add up the review of literature, many offerings have offered diverse perspectives of merger in different industries globally and explained the valuation techniques followed by merging companies, and shareholders possessions effect due to merger. From the review of several papers evaluating the pre and post merger performance of merged companies, it is incidental that majority of the studies powerfully support the concept of improved post merger performance due to merger and it is valuable to the acquirer companies. METHODOLOGY Methodology of the study Sample selection There are several mergers within the TATA Group during the study period from 01.04.2006 to 31.03.2009. For the purpose of corporate analysis, it was decided to select three of the highest deals which merged/ acquired under the TATA Group during the study period. Hence, the sample size of this study is confined to 3. Besides, while selecting the sample, following points were taken into account. Acquirer and target companies ought to belong to the same industry. Availability of information on the merger and industry. Period of the study The present study covers a period of one year from April 1, 2006 to March 31, 2009. But in order to evaluate the financial performance of sample companies on a comparative basis, 15-20 days before merger and after merger were considered. Sources of data The present study fundamentally depends on secondary data. The required data on financial performance prior and post merger were composed and they were obtained from Prowess software, Internet sources, Business Journals (ICFAI JOURNAL ON M A) The data were also collected from books, and newspapers. Tools used In order to study the financial performance of acquirer and target companies, ratios Debt-Equity Ratio, ROCE (%),net profit margin, P/E, EPS, OPM(%) and valuation. (1) Analysis of financial performance The pre-merger average performance of the companies were compared with the post- merger performance of the joint firm. The present study attempts to calculate and study the pre and post merger performance of acquirer and target companies by using financial ratios in order to determine whether mergers resulted in shareholders wealth or not. Accordingly, the following null hypothesis has been tested: H0: The post merger financial performance of the combined firm is not significantly different from the aggregate performance of the acquirer and target companies prior to the merger. (2) Ratios Debt-Equity Ratio: A gauge of a companys financial leverage obtained by dividing  the total liabilities  by  stockholders equity. It shows what proportion of equity and debt the company is presently using to finance their assets. Return On Capital Employed (ROCE) : ROCE compares earnings with the invested capital in the company. It is like Return on Assets (ROA), but also considers sources of financing Net profit margin: The profit margin says how much profit a company makes for every 1 Rupee it generates in revenue or sales. Profit margins vary with industry to industry, but all else being equal, the greater a companys profit margin compared to its competitors, the better. P/E: It is a gauge of the price paid for a share relative to the annual net income or the net profit earned by the firm per share. EPS: The portion of a companys profit which is allocated to each outstanding share of common stock.  Earnings per share  acts as an indicator of  a companys profitability. OPM: Operating margin is a measurement of the proportion of a companys revenue that is left over after variable costs of production such as wages, and raw materials have been paid. A healthy operating margin is required for a company to be able to pay for its fixed costs, such as interest on debt. Also known as operating profit margin and net profit margin. (3) Enterprise Value Enterprise value is a figure that, in theory, represents the entire cost of a company if someone were to acquire it. Enterprise value is a more accurate estimate of takeover cost than market capitalization because it takes includes a number of important factors such as preferred stock, debt, and cash reserves that are excluded from the latter metric. ANALYSIS OF DATA TATA GROUP OF COMPANIES One of the Indias largest business groups in the country. It has about 96 operating companies. Diverse business in 7 sectors. Revenues equivalent to 5.3% of Indias GDP. Group revenue FY 2008: Rs 251,543 Cr. / $ 62.5 b. Group profit FY 2008: Rs 21,578 Cr. / $ 5.4 b .Its 27 publicly listed companies have a combined market capitalization which is the 2nd highest among all business houses in India. Largest employer in private sector over 300,000 employees. A shareholder base of over 2.9 million. Operations in over 80 countries. Products and services exported to 85 countries Tata is a rapidly growing business group based in India with significant international operations. Revenues in 2007-08 are estimated at $62.5 billion (around Rs251, 543 crore), of which 61 per cent is from business outside India. The group employs around 350,000 people worldwide. The Tata name has been respected in India for 140 years for its adherence to strong values and business ethics. The business operations of the Tata group currently encompass seven business sectors: communications and information technology, engineering, materials, services, energy, consumer products and chemicals. The groups major companies are beginning to be counted globally. Considering two of the largest mergers of TATA Group -Tata Steel became the sixth largest steel maker in the world after it acquired Corus. -Tata Communications is a leading global provider of a new world of communications. With a leadership position in emerging markets, Tata Communications leverages its advanced solutions capabilities and domain expertise across its global and pan-India network to deliver managed solutions to multi-national enterprises, service providers and Indian consumers. TATA STEEL-CORUS About the acquisition Date: 30th March 2007 Acquirer: Tata Steel Limited Target company: Corus Plc. Stake: 100 % Deal amount: US$ 12201 m Sector: Steel sector MERGER On January 31, 2007, India based Tata Steel Limited (Tata Steel) acquired the Anglo Dutch steel company, Corus Group Plc (Corus) for US$ 12.20 billion. The merged entity, Tata-Corus, employed 84,000 people across 45 countries in the world. It had the capacity to produce 27 million tons of steel per annum, making it the fifth largest steel producer in the world as of early 2007. Before the acquisition, the major market for Tata Steel was India. The Indian market accounted for sixty nine percent of the companys total sales. Almost half of Corus production of steel was sold in Europe (excluding UK). The UK consumed twenty nine percent of its production. After the acquisition, the European market (including UK) would consume 59 percent of the merged entitys total production. DEAL : An auction was initiated on January 31, 2007, and after nine rounds of bidding, TATA Steel could finally clinch the deal with its final bid 608 pence per share, almost 34% higher than the first bid of 455 pence per share of Corus. Synergies There were many likely synergies between Tata Steel, the lowest-cost producer of steel in the world, and Corus, a large player with a significant presence in value-added steel segment and a strong distribution network in Europe. Among the benefits to Tata Steel was the fact that it would be able to supply semi-finished steel to Corus for finishing at its plants, which were located closer to the high-value markets The Pitfalls Though the potential benefits of the Corus deal were widely appreciated, some analysts had doubts about the outcome and effects on Tata Steels performance. They pointed out that Corus EBITDA (earnings before interest, tax, depreciation and amortization) at 8 percent was much lower than that of Tata Steel which was at 30 percent in the financial year 2006-07 COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION FINDINGS As we can see from the line chart that the %cumulative abnormal return before acquisition was sharply decreasing since past month with not even a single glimpse of positive return on any single day. But as soon as the acquisition took place, the earnings showed a marginal rise and again got back to the level where it was just before the acquisition. This happened due to very large debt generated due to overpaying by acquiring the Corus at a very high price of 608 pence per share as compared to previously valued 455 pence per share. RATIO ANALYSIS TATA Steel (31st Jan 2007) Pre-acquisition Post-acquisition Change ( %) Debt-Equity Ratio 0.31 0.67 116. ROCE (%) 50.13 23.27 -53.6 net profit margin 20.46 21.36 4.4 P/E 8.72 11.35 30.2 ROE(%) 41.7 25.97 -37.7 EPS 61.51 61.06 -0.7 OPM(%) 39.79 36.11 -9.2 INTERPRETATION Debt equity ratio on post acquisition increase because Corus debt was high it was GBP1.6b to buy Corus and so its debt is almost 116% more than in pre acquisition. ROCE shows that post acquisition is very less as compared to pre acquisition it has negative percentage because company has short term returns after one year it will improve in the long run. Net profit margin has very less change as profit is not much affected. P/E increases in post acquisition by 30.2% which show high future cash flow. ROE is decreasing by 37.7 which show that it has more debt than equity. EPS has a very minor change. Operating profit margin is reduced by 9.1% which shows that it has low profit. TATA COMMUNICATION-NTT DOCOMO About the acquisition Date: 13th November 2008 Acquirer: Ntt-Docomo Target company: Tata Teleservices Ltd. Stake: 26 % Deal amount: US$ 2700 m Sector: Tele-communication MERGER Tata Teleservices has sold a stake of 26% to Japans NTT DoCoMo. The deal value is $2.7 bn. Tata Tele has 30 million CDMA subscribers and is rolling out its GSM services. Some say the deal is over-valued and some say its not easy to put value on the fastest growing mobile market in the world. India is the fastest growing market second only to China. It adds 10mn subscribers every month. The current subscriber base stands at 300+million and is expected to be 700 million in 2012. That is almost double to todays numbers. The Road ahead Great deal it may be, but it has its risks. One reason is that telecom deals have been controversial in recent times. This goes back to late last year when the government sold pan-India licenses for $333 million apiece, amid a welter of controversy. DoCoMo, in accordance with regulations of the Securities and Exchange Board of India, expects to make an open offer to acquire up to 20 per cent of outstanding equity shares of Tata Teleservices Maharashtra (TTML), a Tata telecommunication company, through a joint tender offer along with Tata Sons. TTSL and TTML through the Tata Indicom brand, have increased their combined share of the fast-growing Indian mobile market and their combined subscriber base now stands at over 30 million. TTSL expects to leverage DoCoMos expertise in the development and delivery of value-added services, where DoCoMo is a firmly established market leader. RATIO ANALYSIS TATA DOCOMO (13-11-08) Pre- acquisition Post- acquisition Change (%) Debt-Equity Ratio 0.11 0.14 27.27% ROCE (%) 7.33 7.44 1.50% net profit margin 9.55 10.61 11.10% P/E 0 12 0 ROE(%) 11.14 10.97 -1.53% EPS 0.89 1.11 24.72% OPM(%) 16.2 18.7 15.43% FINDINGS Debt equity ratio on post acquisition debt is increasing which shows company debt is increasing after merger. ROCE is constant it has not change much.Net profit margin increases by 11.10 as it income increases in post acquisition as compared to pre acquisition. P/E highly increases in post acquisition from 0 to 12%. ROE is decreasing by 1.53% which shows that it slightly more debt than equity. EPS is increasing drastically by 24.27% which is very profitable for investors. Operating profit margin is increased by 15.43% which shows that company profit margin is very fairly profitable. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION The return of the target company Tata Communication has been very poor since the past 15 to 20 days before the acquisition but it almost got to break-even soon after the acquisition date. This sustained for the next 8 to 10 days but again got back into negative returns zone due to poor customer support to the newly entered Docomo brand in highly competitive communications market in India. TATA MOTOR JLR About the acquisition Date: 27th March 2008 Acquirer: Tata Motors Ltd Target company: Jaguar Land Rover Stake: 100 % Deal amount: US$ 2300m Sector: Automotive Detailed Case Study In June 2008, India-based Tata Motors Ltd. announced that it had completed the acquisition of the two iconic British brands Jaguar and Land Rover (JLR) from the US-based Ford Motors for US$ 2.3 billion. Tata Motors stood to gain on several fronts from the deal. One, the acquisition would help the company acquire a global footprint and enter the high-end premier segment of the global automobile market. After the acquisition, Tata Motors would own the worlds cheapest car the US$ 2,500 Nano, and luxury marquees like the Jaguar and Land Rover. Though there was initial skepticism over an Indian company owning the luxury brands, ownership was not considered a major issue at all. According to industry analysts, some of the issues that could trouble Tata Motors were economic slowdown in European and American markets, funding risks, currency risks etc. The Challenges Morgan Stanley reported that JLRs acquisition appeared negative for Tata Motors, as it had increased the earnings volatility, given the difficult economic conditions in the key markets of JLR including the US and Europe. Moreover, Tata Motors had to incur a huge capital expenditure as it planned to invest another US$ 1 billion in JLR. This was in addition to the US$ 2.3 billion it had spent on the acquisition. Tata Motors had also incurred huge capital expenditure on the development and launch of the small car Nano and on a joint venture with Fiat to manufacture some of the companys vehicles in India and Thailand. This, coupled with the downturn in the global automobile industry, was expected to impact the profitability of the company in the near future CURRENT SCENARIO In less than three years after its acquisition, Jaguar Land Rover has metamorphosed from a millstone around Tata Motors neck into its crowning jewel. In the June 2010 quarter, JLR division accounted for nearly 70% of the companys net profit and over 60% of its revenues on the consolidated basis. This was more than what the market has expected and the stock is up by nearly 150% in the past two trading sessions. JLR benefited from an improvement in its pricing power and a favourable exchange rate in the US dollar and the euro. The two worked in tandem and resulted in a sharp 60% jump in JLR revenue per unit to around  £38,000 in June 2010 quarter compared to the  £23,800 a year ago. With the raw material costs remaining benign, it led to a sharp improvement in the divisions operating margin and its reported net profit of  £221 million (`1,613.3 crore) in the first quarter as against a net loss of  £64 million (`467 crore) a year ago. RATIO ANALYSIS TATA MOTORS (27- 03 2008) Pre-acquisition Post- acquisition Change (%) Debt-Equity Ratio 0.56 0.97 42.27 ROCE (%) 30.52 6.88 -343.60 net profit margin 6.88 11.47 40.02 P/E 15.45 9.59 -61.11 ROE(%) 30.98 5.34 -480.15 EPS 47.1 18.81 -150.40 OPM(%) 11.16 7.89 -41.44 FINDINGS Debt equity ratio is increasing by 42.27% as Tata took loan of banks to acquire JLR.ROCE increases vey high by 343.60% as compared to pre acquisition as it gauges that company that generate its earnings from the total pool of capital which indicates profitability.Net profit margin increases as it income increases in post acquisition as compared to pre acquisition. P/E highly decreases in post acquisition by 60.1% which in investor point of view they will be profitable to invest to get high earning. ROE is highly increasing by 480.15% which shows that it has more equity than debt. EPS is increasing drastically by 480.15% which is very profitable for investors. Operating profit margin is reduced by 41.44% which shows that company profit margin is very less. COMPANYS RETURN BEFORE AND AFTER ACQUISITION PRE-ACQUISITION POST-ACQUISITION INTERPRETATION As we can see from the line chart that the cumulative return before merger was negative and the entire trend is moving in the negative direction due to poor returns of tata motors. A soon as the acquisition took place, the highly profit generating Jaguar as well as Land Rover added to the profit and earnings of the tata motors. The brand value of JLR added to the highly reputable Tata Group and the companys balance sheet. This can be clearly seen in the line chart above. VALUATION AND INTERPRETATION EV Multiples of Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 1.17x compared to the deal of 0.68x of Corus Groups sales. This can be possible due to high sales value, reducing the multiple to 0.68x. The lowest multiple (Steel Authority of India) is at 0.73x. EBITDA Multiple: EBITDA multiple of its peers averages at 4.38x compared to the deal multiple of 7.02x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple. It can be observed that Tata played very aggressively. EBIT Multiple: EBIT multiple of its peers averaged at 5.54x compared to the deal of 10.19x of Corus Groups sales. Even the highest multiple (Jindal Steel Power) is at 8.39x. PE Multiple: The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers. The average PE multiples is 7.95x compared to 68.23x at which the deal haapened. EV Multiples of Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. Sales Multiple: The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docmo. EBITDA Multiple: Again the average EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. EBIT Multiple: EBIT multiple of its peers is 25.5x compared to the deal of 952.96x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 41.02x. PE Multiple: The PE multiple for Tata Teleservices is negative as its net income is negative Note: The multiples are high on account that Sales and the profitability of Tata Teleservices is low, inturn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. FINDINGS FROM VALUATION OF ENTERPRISE VALUE MULTIPLE Tata Corus Tata Steel and Corus Group deal happened at high multiples compared to its peers. We can observe that the average multiples of the peer group company stands half compared to the deal multiples. Even the highest multiple (Jindal Steel Power) is at 4.38x. This is almost half of the deal multiple It can be observed that Tata played very aggressively as it paid high enterprise value as compared to our analysis. A reason for Corus to be sold is chance to Bail out of Debt and Financial stress. TATA Steel Paid 7.02 Times EBITDA of Corus Enterprise Value. The PE multiple of the deal is very high on the account that the margins of Corus are very low compared to Tata Steel and other peers the only company who has high P/E is Jindal steel. Tata NTT Docomo The deal of Tata Teleservices and NTT Docomo happened at very high multiples. We can observe that the average multiples of the peer group company stands very low compared to the deal multiples. The average sales multiple of its peers is 5.37x compared to the deal of 26.98x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 9.24x. Thus we can conclude that Tata Teleservices got very good price for its stake dilution for NTT Docomo. The PE multiple for Tata Teleservices is negative as its net income is negative. EBITDA multiple of its peers is very less, 16.35x compared to the deal of 99.81x (as on 31st March, 2008) of Tata Teleservicess sales. Even the highest multiple (Reliance Communication) is at 26.74x. This is a huge difference. NTT Docomo paid 6 times more what it should have paid to Tata. The multiples are high on account that Sales and the profitability of Tata Teleservices is low, in turn giving very high multiples. Its sales stands at Rs. 1,815.5 Cr. compared to the average sales of Rs. 11,490.6 Cr. of its peers. SUMMARY Except Tata Steel- Corus deal, all the other 2 acquisitions was well accepted by not only well accepted by the owners of the company (the shareholders) but even made the entire Tata group come into the eyes of fortune 500 list. In-fact it ranked at 56th position at a global level in 2009 CONCLUSION This study was undertaken to test what is the impact of mergers on the financials of acquiring corporate by examining some pre- merger and post-merger financial, in terms of impact on operating performance. The results from the analysis of pre- and post-merger operating performance ratios for the acquiring firms in the sample showed that there was a differential impact of mergers, for different industry sectors in India. Type of industry does seem to make a difference to the post-merger operating performance of acquiring firms. Expansion through mergers and acquisition is one of the best ways for any domestic company to step outside the shores of India in an international market place and acquit itself as a global player Company can turn into conglomerate in reasonably less time by capitalizing on its strengths of efficiency and effectiveness by acquiring relatively poor performing companies as TATA did in almost all its group of companies Recent examples of companies which adopted similar pattern of expansion are Renuka Sugars, Arcelor Mittal, Reliance, Essar Group, Aditya Birla Group, etc. One can study any of the above mentioned company and conclude that the key underlying decision of these companies expanding quickly and efficiently is their timely decision of merging and acquiring appropriate companies

The American Dream By F. Scott Fitzgerald And Death Of A...

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Scott Fitzgerald is mostly known for his images of young, rich, immoral individuals pursuing the American Dream of the 1920’s (Mangum). This image is best portrayed in his greatest novel, The Great Gatsby, alongside his principal themes, â€Å"lost hope, the corruption of innocence by money, and the impossibility of recapturing the past† (Witkoski). Fitzgerald was identified as a modern period writer because his themes and topics were inconsistent with traditional writing (Rahn). The modern period

Ethcal issues of Human Organ Sales free essay sample

Humanity is a continually growing and evolving as a race here on earth, from creating communication techniques like speaking, writing, and signing, to inventing cures to fight infection, bacteria, and parasites that can ravage a human body, and enhancing medical surgical practices to further save lives from very common injuries or sicknesses. However, a new breakthrough in the medical sciences has hit the streets of the world by storm, declaring that the solution to human organ transplants is solved. A new idea and practice that will involve every individual to have an option to both save their life, as well as the life of another human being. The new solution for human transplant and donation involves the legalization of selling human organs on the open market. In hindsight, this seems to answer all the problems of organ donning, and transplant, allowing people to sell their organs for cash and increase the supply of organs to the general population. However, this new idea and grand solution has one big issue, the public backlash from religious groups, The Roman Catholic Church, political organization like Democrats and GOP, and the overall public of America. There are viewpoints from others across the nation that will argue that human organ sales are beneficial by being legalized, but I will be explaining the problems that would be cause by the sale of human organs. I will argue the ethical issues that arise amongst religious groups, the financial fallout that is caused by the sale of human organs, and challenges the Constitutional Law, The National Organ Transplant Act of 1984, which makes it illegal to sell human organs. The first cause that arises from human organ sales is the ethical and moral backlash from religious groups and other cultural organization. Both the Roman Catholic Church and the Protestant Church attack the idea of legalization of human organ sales to protect human morally to one’s body. To explain, â€Å"The following conditions would render the sale of human organs morally impermissible. If the transaction were carried out in a manner that obfuscates, denies, or undermines the belief in the divine origin of human life or the dignity thereby due a corpse; or if the transaction, and the compensation gained, is motivated by or used for illegal, immoral, or irreligious purposes† (Capaldi, 2000, p. 140). Religious groups like the  Catholic Church believe that a body is Gods temple, which either living or deceased, the integrity of the human body must be preserved. In addition, religious groups would argue that individual’s must have control of their body, and its fate. â€Å"Society, specifically in the form of its religious organization, the State, may not commandeer the organs of one human being without the permission of that individual person. The relation of individual human beings to the larger body politics is moral, not organic. The total organism which is humanity has no right to impose on individuals demands in the domain of physical being on the grounds of any natural right of the ‘whole’ to dispose of the parts† (Capalidi, 2000, p. 142). The disposal of the body and its organs is sacred, and many religious organizations fixate on proper ceremonial burials and traditions that need to be upheld, and by legalizing organ sales, questions the authority and beliefs of religious groups. Finally, the topic of human marketing arises, saying that human organ sales takes the human body, looked upon as Gods temple, making the bodily organs materialistic, not holy relicts created by God. Pope John Paul II expressed, â€Å"the concern, if a particular sale promotes a â€Å"reductive materialist† conception of human life, it is unacceptable† (Capalidi 2000, p.143). Pope John Paul II argues that the human body is sacred and by allowing the sale of human organs, makes the body a walking market place, which causes a huge uproar in the religious community. Transplantation from a corps or living human requires the body to be treated with the respect due to the abode of a spiritual and immortal soul, an essential consequence of a human person whose dignity it shared, needs to be honored. Human organ sales attack the beliefs and morals of many religious organizations, causing these organizations to fight back to protect their ethical beliefs, protection of cultural traditions, and keeping the human body as gods temple and not an open market for sale. The second cause from human organ sales is the financial backdrop that occurs if individuals could sell their body organs. First off, the main issue that arises financially includes the issue that the rich will only have the access to the benefits of buying organs. Within the current climate of health care reform, financial incentives have become a part of medicine, doctors, preferred providers, and exedra, might be reasonably  assumed it will become a greater part of health care delivery in the future† (Borna, 1987, p. 38). Since individuals and companies looking to make a profit currently run the health care industry in the United States, the sale of organs should fall into the same category as other medicinal services. The field of medicine is constantly evolving and doctors and researchers are constantly developing new ways to save lives; however, they do not freely give these ideas and developments away. The willing sale of human organs should be no different, in that it takes the same approach that other medical developments currently take† (Borna, 1987, p. 38). Individuals who struggle financially obviously will not have the opportunity to purchase organs, limiting the market to those who can afford human organs, raising the price higher, and allowing those with money to live longer, and those who have limited funds die sooner. So, human organ sales does not sound as appealing when it truly, it is not saving lives, in turn, it adds more stress on average families, hurts the economic market as a whole, and the next topic of discussion the decrease in organ donations. With organs for sale on the open market, and the beneficiary being high-class individuals, the mid-income to low-income families will depend on organ donations for organ transplant, well so they think. With sales of organs on the market, the donation rate of organs will plummet because organs are now being shipped to the open market. To explain, â€Å"It has been suggested that donation rates could decrease under such a system due to a backlash and losses from the current donor pool based on pure altruistic giving (Stempsey, 2000, p.195). Now, with the sale of human organs on the open market, donations decrease, causing public outburst, which in turn, causes finical failure across the board. It has been stated, â€Å"The ideal public policy would be one in which everyone voluntarily donated their organs, especially to private medical-charitable agencies† (Stempsey, 2000, p.197). Donations are what keep organ transplants flowing into the market, makes an equal playing field for all social classes, and stabilizes the economic market. The last negative cause from human organ sales is the ability to keep overall public order, while trying to challenge the National Organ Transplant Act of 1984, which made human organ sales illegal on the open market. The United States government under President Ronald Regan, signed the National Organ Transplant Act, making organ selling illegal, but not making it illegal to donation, with the consensus that the public would be oblige to donate their organs. Now, at that time, the United States had a conservative president who believed in the sanctity of human life, which fell under human organ sales, and even though thirty years later, the consensus stays the same. Even in today’s times, with liberal leadership, the public’s perspective has not changed. For instance, â€Å"Under such assumptions, opponents of commerce in human body parts conclude that commercialization could never be an ethical option to pursue for the public; while this objection is also what George Anna’s claims to be the single major argument from a legal perspective† (Torcello, L., Wear, S. 2000, p. 153). In fact, the people of the United States agree that the Act signed nearly thirty years ago, must stay in place to keep order among the populous. The approval of the nation’s citizens is key, and if the sale of human organs commenced, order would be broken within the country. A sub reason why the overall populous does not want the sale of human organs is governmental greed, lack of responsibility on behalf of the people, and regulation of organ sales within an open market. Greed is a powerful concept that has ravaged the United States Government, â€Å"Commercialization in itself cannot be held as moral. In so far as it has the potential to cause greed, it is given another value, insofar as one may avoid the temptation of overzealous greed, the faithful are given a valuable opportunity to test and demonstrate their sanctity† (Torcello, L., Wear, S. 2000, p. 153). Greed is a part of American society, and allowing the government to control human organ sales is just another fateful cause that would negatively evolve from allowing the National Organ Transplant Act to be repealed and legalize the sale of human organs. Lastly, government responsibility, as it was stated earlier in my argument, lacks tremendously, holding no accountability, but only reap the benefits of organ sales while not allowing or blame private companies for the failures of the Federal Government. To explain, â€Å"Government programs discourage private charity, partly because everyone assumes that someone else is responsible for taking care of the problem. Commendable aspects of charity evaporate. It is inherently impossible for the government or a government agency in a modern liberal culture, such as  the United States, to formulate an objective policy to promote a canonical, content-full account of human good† (Wellington, A. J., Sayre, E. A. 2011, p.2-3). As I spoke before, even in a liberal society, where socialism is the backbone of their idealism, Americans, even those who support many of their same ideas and principles, understand that too much government involvement only causes hardships here in America, designed both as a capitalistic society, with ideals of socialism construct. The Government involvement in allowing human organ sales in an open, free-lance market, is by far the most important and harmful cause to America if the sales of human organs was permitted. In hindsight, ethical issues that arise amongst religious groups, the financial fallout that will be caused by the sale of human organs, and the challenges of overall public order due to Constitutional Law, shown by The National Organ Transplant Act of 1984, which makes the sale of human organs illegal is an overall national issue. I argue that these three major issues will be at the forefront of the battle of legal sale of organs, causing religious unrest throughout the world, financially degrade the U.S economy, as well as its citizens of all three social classes, and create social unrest among Americans because of Federal Government involvement. In turn, the idea that the sale of human organs is beneficial is completely false in all aspects of the argument, due to the horrific amounts of negative causes and phenomenon’s that will occur and continue to evolve exponentially worse as time goes on. I ask you, do you think that legalizing the sale of human organs would actually benefit the citizens of America long or even short term, or grief stricken the families of America who work, believe and fight for this great nation? References Capaldi, N. (2000). A Catholic Perspective on Organ Sales. Christian Bioethics: Non- Ecumenical Studies In Medical Morality, 6(2), 139-151. Borna, S. (1987). Morality and Marketing Human Organs. Journal Of Business Ethics, 6(1), 37-44. Torcello, L., Wear, S. (2000). The Commercialization of Human Body Parts: A Reappraisal from aProtestant Perspective. Christian Bioethics: Non-Ecumenical Studies In Medical Morality, 6(2), 153. Stempsey, S. E. (2000). Organ Markets and Human Dignity: On Selling Your Body and Soul. Christian Bioethics: Non-Ecumenical Studies In Medical Morality, 6(2), 195-204.

Benefits of the Acai Berry free essay sample

Benefits of the Acai Berry Robyn Roberson May 30, 2011 Gamma Alexis LeBlanc Aveda Institute Benefits of the Acai Berry The Acai berry (ah-SAH’-ee) is known around the world as a â€Å"super fruit† The Acai berry is a one inch-long purple berry; that grows high atop the 90 foot tall Acai palm tree, native to Central and South America. This highly perishable berry is related to the blueberry and cranberry; and holds more antioxidant power than the blackberry, oranges, and even red wine. The berry must be eaten or processed within 24 to 48 hours because it loses its benefits and freshness quickly. In the Special Acai Report the Acai berry is mentioned, â€Å"to have the antioxidant concentration of five times higher than that of Gingko Biloba, the popular â€Å"brain boosting† herbal supplement that is renowned for its antioxidant properties. Due to the vitality of this fruit, it is also referred to as the â€Å"Viagra of the Amazon. We will write a custom essay sample on Benefits of the Acai Berry or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page ( Special Acai Report 2005, 1)† Other benefits attributed to this amazing little berry are anti-aging properties, joint flexibility, decreased susceptibility to heart related problems, lowers cholesterol, and fights depression. It is even known aide in curing cancer. Antioxidant is defined as, â€Å"a molecule capable of inhibiting the oxidation of other molecules. Oxidation is a chemical reaction that transfers electrons from a substance to an oxidizing agent. Oxidation reactions can produce free radicals. In turn, these radicals can start chain reactions. When the chain reaction occurs in a cell, it can cause damage or death of the cell. Antioxidants terminate these chain reactions by removing free radical intermediates, and inhibit other oxidation reactions. They do this by being oxidized themselves. (Wikipedia, 2011 1)† These antioxidant rich berries aide skin by reducing the effects of aging and providing better elasticity. An E-zine article stated, â€Å"Regardless of whether it is used as a topical cream or as an oral pill, the Acai berry supplements can nourish the skin and improve skin tone. We often cover our face with creams made from multiple chemicals, not all of which are beneficial to the body. Acai berry is a natural product and improves the bodys ability to heal itself by removing harmful free radicals in the body. In addition to antioxidants, Acai supplements contain phytonutrients and vitamins for proper skin regeneration. ( Drake, 2011 2). † In essence, this berry is a â€Å"fountain of youth. † Besides the ability to benefit cosmetically, other health benefits of the Acai berry have shown to lower the risk of heart disease, lower cholesterol levels with proper diet, elevate one’s mood therefore alleviating depression, and also provides a boost of energy. Perhaps the most interesting fact about the Acai berry is from a study done by the University of Florida. The study showed extracts from acai berries triggered a self-destruct response in up to 86 percent of leukemia cells tested, said Stephen Talcott, an assistant professor with University of Floridas’s Institute of Food and Agricultural Sciences. † The study also explained, â€Å"that it was not intended to show whether compounds found in acai berries could prevent leukemia in people; rather, this was onl y a model and we do not want to give anyone false hope. We are encouraged by the findings, however. Compounds that show good activity against cancer cells in a model system are most likely to have beneficial effects in our bodies. University of Florida, 2006 2, 4)† In summation, the acai berry may not fully cure cancer, but it’s benefits for the human body go beyond skin care. The acai berry may be small, but it’s benefits are worth it’s weight in gold. Acai is not a drug, so it has no side effects. Supplements containing acai may; so, as always, it is important to read labels. Health benefits, better skin, and increased energy are just a few reasons to give the Acai berry a try. It can be found whole in certain areas and in creams, juices, and even dietary supplements. Just 1 to 4 ounces every day can have such amazing benefits. Plus, nearly 8 in 10 people who purchase acai supplements and products will reorder the product, a true testament to the value of the berry. Citations Amherst. (2005). Special Acai Report . Retrieved from http://www3. amherst. edu/~dmirwin/AcaiReport. html Drake, J. A. (2011). E-zine Articles. E-zine. Retrieved from http://ezinearticles. com/? Acai-Berry-and-the-Benefits-to-Your-Skin=1948689 University of Florida. (2006). University of Florida News. Retrieved from http://news. ufl. edu/2006/01/12/berries/ Wikipedia. (2011). Wikipedia. Retrieved from http://en. wikipedia. org/wiki/Antioxidant