Environmental and Cost Synergy in Supply Chain Network Integration in Mergers and Acquisitions

In this paper, we quantify and assess, from a supply chain network perspective, the environmental effects resulting when a merger or acquisition occurs and the resulting synergy from possible strategic gains. We develop a multicriteria decision-making supply chain network framework that captures the economic activities of manufacturing, storage, and distribution pre and post the merger. The models yield the system optima associated with the minimization of the total costs and the total emissions under firm-specific weights. We propose a synergy measure that captures the total generalized cost. We then apply the new mathematical framework to quantify the synergy obtained for specific numerical examples.