What are the major types of merger and acquisition?  

Expert Answers
thanatassa eNotes educator| Certified Educator

Both mergers and acquisitions refer to ways in which companies combine with each other. If the two companies are approximately the same size and the result is a new entity with an identity fusing that of the two previous companies, the deal is normally called a merger, whereas if company A completely subsumes company B, so that company B ceases to exist but company A retains its identity, the deal is called an acquisition.

If the two companies are in the same industry with similar product lines, the acquisition is described as horizontal. If the company being acquired is one with which the acquiring company does business (distributor, supplier, etc.) the acquisition is vertical. If the two companies are in unrelated areas, the result is a conglomerate.

Access hundreds of thousands of answers with a free trial.

Start Free Trial
Ask a Question