Following the path of his father and grandfather, Julio M. Herrera Velutini ventured into the world of banking and finance after completing his college education. The chairman of an international bank based in Puerto Rico, Julio Herrera Velutini has acquired stakes in several financial firms and made them part of the family holdings. Acquisitions occur often in the business world. Strategic acquisitions are performed to either improve synergy, grow market share, or increase operational efficiency. Synergy is created when two companies with similar products and services come together. One company can acquire another with similar product or service offerings and combine both companies’ resources to reduce operational costs and increase branch locations. Acquisitions lead to increased market share. When a company acquires another operating in a similar industry, essentially a competitor company, the buyer also acquires its existing business. That way, the acquiring company gains market share without doing the hard work involved in earning new business and at the same time eliminates competition. The final reason for strategic acquisitions is to improve operational efficiency in the overall business or in a specific segment such as supplies or marketing. For example, one company can acquire its supplier and with that, reduce its costs by the margin the supplier made, boosting supply chain efficiency.
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AuthorMr. Velutini has experience with both established banks and young banks. S Archives
December 2017
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