DEFINITION of 'Merger'

The combining of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock.


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Basically, when two companies become one. This decision is usually mutual between both firms.

  1. Acquisition

    A corporate action in which a company buys most, if not all, ...
  2. Megamerger

    The joining of two large corporations, typically involving billions ...
  3. Consolidate

    The combining of assets, liabilities and other financial items ...
  4. Sweetheart Deal

    A merger, a sale or an agreement in which one party in the deal ...
  5. Forward Triangular Merger

    The acquisition of a target company by a subsidiary of the purchasing ...
  6. Target Firm

    A company which is the subject of a merger or acquisition attempt. ...
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  1. How does the level of mergers and takeovers in the Internet sector compare to the ...

    The level of mergers and takeovers in the Internet sector is higher than in the broader market. The Internet sector contains ... Read Full Answer >>
  2. What is the difference between a money market fund and a savings account?

    The primary advantages of the Herfindahl-Hirschman Index (HHI) are the simplicity of the calculation necessary to determine ... Read Full Answer >>
  3. What's the difference between a merger and a hostile takeover?

    The difference between a merger and a hostile takeover has to do with the manner in which two companies merge to become a ... Read Full Answer >>
  4. What's the difference between a merger and an acquisition?

    Mergers and acquisitions are two of the most misunderstood words in the business world. Both terms are used in reference ... Read Full Answer >>
  5. How does a merger affect the customer?

    A merger can affect the customers of the involved business entities on several levels, including price of the product or ... Read Full Answer >>
  6. How does a merger affect the shareholders?

    A merger affects the shareholders of both companies in different ways and is influenced by several factors, including the ... Read Full Answer >>
  7. Why would a company do a reverse merger instead of an IPO?

    Reverse mergers are often the most expedient and cost-efficient way for private companies that hold shares that are not available ... Read Full Answer >>
  8. What business processes were used to establish the Chevrolet motor company?

    William Durant, the founder of General Motors, lost control of his company due to his aggressive expansion plans. Going wholeheartedly ... Read Full Answer >>
  9. What is a stock-for-stock merger and how does this corporate action affect existing ...

    First, let's be clear about what we mean by a stock-for-stock merger. When a merger or acquisition is conducted, there are ... Read Full Answer >>
  10. What is the difference between a merger and a takeover?

    In a general sense, mergers and takeovers (or acquisitions) are very similar corporate actions - they combine two previously ... Read Full Answer >>
  11. Why do companies merge with or acquire other companies?

    Some of the reasons for mergers and acquisitions (M&A) include: 1. Synergy: The most used word in M&A is synergy, ... Read Full Answer >>
  12. In M&A how does an all-stock or all-cash deal affect the equity of the buying company?

    Mergers and acquisitions (M&A) are forms of corporate restructuring that are becoming increasingly popular in the modern ... Read Full Answer >>

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