Definition of Merger



A merger is when two companies agree to unite with each other and establishes a new company. After the merger, out of two companies, only one company is going to continue only.

The merger is different from acquisition when former merge into other company willingly while later is the approach where one company buys other company and take control of their operations.

 


The merger is done to increase the market share, explore and expand into new segments, decrease operational costs, expand business or save money by saving jobs of bankruptcy firms.

The merger has 4 types;

  1. Horizontal Merger
  2. Vertical Merger
  3. Concentric Merger
  4. Conglomerate Merger
 

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