Oorja and KTC Wifi are two broadband provider companies operating in South-East Delhi. Both are close competitors and have developed their strong customer base over the years. The COVID-19 pandemic made the offices and schools switch their customer base online. Just then a multinational service provider company, Storex BB, entered the market and launched its services at a much cheaper price with better connectivity. To counter the threat posed by Storex BB, both companies Oorja and KTC Wifi decided to consolidate their business. (a) Identify the enterprise growth strategy adopted by Oorja and KTC Wifi. (b) State the type of growth strategy identified. (c) Give the goal of the type of growth strategy.

Question

Accepted Answer

(a) The enterprise growth strategy adopted by Oorja and KTC Wifi is **Merger**, which is a form of external expansion or business combination.

(b) The type of growth strategy identified is a **Horizontal Merger**. A horizontal merger takes place between companies in the same industry, often competitors offering the same goods or services. The goal is usually increased market share and potential cost reduction through joined operations.

(c) The goal of a horizontal merger is to achieve **economies of scale**, increase market share, and eliminate competition. By merging, the combined entity can pool resources, reduce duplicate operations, negotiate better deals with suppliers, and counter the threat posed by new market entrants like Storex BB. In this case, Oorja and KTC Wifi merged to counter the threat from Storex BB which entered the market with cheaper prices and better connectivity.