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Some of the reasons for Mergers and Acquisitions (M&A) include:
1. Synergy: The most used word in M&A is synergy, which is the idea that by combining business activities, performance will increase and costs will decrease. Essentially, a business will attempt to merge with another business that has complementary strengths and weaknesses.
2. Diversification / Sharpening Business Focus: These two conflicting goals have been used to describe thousands of M&A transactions. A company that merges to diversify may acquire another company in a seemingly unrelated industry in order to reduce the impact of a particular industry's performance on its profitability. Companies seeking to sharpen focus often merge with companies that have deeper market penetration in a key area of operations.
3. Growth: Mergers can give the acquiring company an opportunity to grow market share without having to really earn it by doing the work themselves - instead, they buy a competitor's business for a price. Usually, these are called horizontal mergers. For example, a beer company may choose to buy out a smaller competing brewery, enabling the smaller company to make more beer and sell more to its brand-loyal customers.
4. Increase Supply-Chain Pricing Power: By buying out one of its suppliers or one of the distributors, a business can eliminate a level of costs. If a company buys out one of its suppliers, it is able to save on the margins that the supplier was previously adding to its costs; this is known as a vertical merger. If a company buys out a distributor, it may be able to ship its products at a lower cost.
5. Eliminate Competition: Many M&A deals allow the acquirer to eliminate future competition and gain a larger market share in its product's market. The downside of this is that a large premium is usually required to convince the target company's shareholders to accept the offer. It is not uncommon for the acquiring company's shareholders to sell their shares and push the price lower in response to the company paying too much for the target company.
For more on this topic, read The Basics Of Mergers And Acquisitions and The Wacky World Of M&As.
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When companies operating at different but related levels of an industry merge it is known as an?
vertical merge
Why do companies merge?
Companies merge for many reason , companies merge when they are woth more together than apart.. some do to cut costs i.e in vertical integration when a corp. merges with either its supplier or consumer .. others merge for growth and market power and to eliminate competition.. these mainly merge with their competitors to create more power in the markets i.e AT&T and Bell South both are Telecom companies. its not the best idea, but actually some companies merge to diversify, like acquiring another company in a seemingly unrelated industry in order to reduce the impact of a particular industry's performance on its profitability.
Who uses mail merge?
Companies, Groups of people, teachers and Department stores.
What is a merge?
A merge is when 2 or more companies come together to perform one business or job. Sadly, though it can possibly result in some lay offs
Did apple and Macintosh merge?
no the apple company havent merged with any other companies
What does mearge mean?
There is no meaning for the word mearge. The word, merge, means to come together in a common area. Companies that merge group together assets. Cars merge onto a freeway to join traffic traveling in the same direction.
Why did xm satellite radio and Sirius merge?
XM and Sirius want to merge because they think the combined company will be more profitable than the companies would be operating separately
Why might the owners of two separate companies agree to merge their businesses?
To make them more money.
What companies did Walt Disney work with but not merge with?
That's a good one Im not quite sure
Why do companies merge with each other?
It could be for several reasons, such as if one corporation bought out the other and now they are merged together as one making it a bigger and stronger company. Some companies merge for survival reasons and feel by coming together they have a better chance of staying in business. Some do it for marketing/promotional reasons.
Is it merge in or merge into?
Merge into is more correct.
What is the meaning of merge?
of Merge
