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Often, yes. There will probably be overlap in the merger, and in most companies, you will let some people go because their jobs are already covered by other people. Also, if there are financial concerns, or the company was only purchased for one reason, then the company that made the purchase can really make any changes that they want to, within the limits of employment law.

It isn't 100% of the time, and occasionally there will be a company that will be fully absorbed by another, with all the employees. It just doesn't happen often.

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