Mergers and acquisitions

mergermergedM&Aacquisitionacquisitionsacquiredmergersmergemerger and acquisitionmergers & acquisitions
Mergers and acquisitions (M&A) are transactions in which the ownership of companies, other business organizations, or their operating units are transferred or consolidated with other entities.wikipedia
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Consolidation (business)

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From a commercial and economic point of view, both types of transactions generally result in the consolidation of assets and liabilities under one entity, and the distinction between a "merger" and an "acquisition" is less clear.
In business, consolidation or amalgamation is the merger and acquisition of many smaller companies into a few much larger ones.

Takeover

hostile takeoveracquisitionAcquired
An acquisition/takeover is the purchase of one business or company by another company or other business entity.
In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to the acquisition of a private company.

Due diligence

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The letter of intent generally does not bind the parties to commit to a transaction, but may bind the parties to confidentiality and exclusivity obligations so that the transaction can be considered through a due diligence process involving lawyers, accountants, tax advisors, and other professionals, as well as business people from both sides.
A common example of due diligence in various industries is the process through which a potential acquirer evaluates a target company or its assets for an acquisition.

Material adverse change

Material adverse effect
In the fields of mergers and acquisitions and corporate finance, a material adverse change (abbreviated MAC), material adverse event (MAE), or material adverse effect (also MAE) is a change in circumstances that significantly reduces the value of a company.

Demerger

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The terms "demerger", "spin-off" and "spin-out" are sometimes used to indicate a situation where one company splits into two, generating a second company which may or may not become separately listed on a stock exchange.
It is the converse of a merger or acquisition.

Valuation (finance)

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Valuations are needed for many reasons such as investment analysis, capital budgeting, merger and acquisition transactions, financial reporting, taxable events to determine the proper tax liability.

Valuation using discounted cash flows

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This article details the mechanics of the valuation, via a worked example, including modifications typical for startups, private equity and venture capital, corporate finance "projects", and mergers and acquisitions.

Stock swap

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See Stock swap, Swap ratio.
where, during the merger or acquisition, the swap provides an opportunity to pay with stock rather than with cash.

Square Enix

Square-EnixG-CraftSquare Enix Co., Ltd.
The original Square Enix Co., Ltd. was formed in April 2003 as the result of a merger between Square and Enix, with the latter as the surviving company.

Vertical integration

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Vertical integration is often closely associated to vertical expansion which, in economics, is the growth of a business enterprise through the acquisition of companies that produce the intermediate goods needed by the business or help market and distribute its product.

Stock exchange

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Acquisitions are divided into "private" and "public" acquisitions, depending on whether the acquiree or merging company (also termed a target) is or is not listed on a public stock market.
A takeover bid or mergers and acquisitions through the stock market is one of the simplest and most common ways for a company to grow by acquisition or fusion.

Boutique investment bank

boutique marketboutiqueBoutique Investment Banks
Highly focused and specialized M&A advice investment banks are called boutique investment banks.
Of those involved in corporate finance, capital raising, mergers and acquisitions and restructuring and reorganizations are their primary activities.

Sega Sammy Holdings

SammySega SammySammy Studios
Sega Sammy Holdings Inc. is a Japanese consolidated holding company & conglomerate formed from the merger of Sega and Sammy in 2004.

Swap ratio

See Stock swap, Swap ratio.
In corporate finance, the swap ratio is an exchange rate of the shares of the companies that undergo a merger;

Letter of intent

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The documentation of an M&A transaction often begins with a letter of intent.

GlaxoSmithKline

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Some of the largest mergers of equals took place during the dot.com bubble of the late 1990s and in the year 2000: AOL and Time Warner (US$164 bil.), SmithKline Beecham and Glaxo Wellcome (US$75 bil.), Citicorp and Travelers Group (US$72 bil.).
Established in 2000 by a merger of Glaxo Wellcome and SmithKline Beecham, GSK was the world's seventh largest pharmaceutical company as of 2015, after Johnson & Johnson, Pfizer, Novartis, Merck, Hoffmann-La Roche and Sanofi.

Strategic management

business strategycorporate strategystrategy
As an aspect of strategic management, M&A can allow enterprises to grow or downsize, and change the nature of their business or competitive position.
The relative advantages of horizontal integration, vertical integration, diversification, franchises, mergers and acquisitions, joint ventures and organic growth were discussed.

Managerial hubris

Manager's hubris
Managerial hubris is one reason a manager may choose to invest in a merger that on average generates no profits.

Cartel

cartelsprice fixing cartelTrusts
One strategy to keep prices high and to maintain profitability was for producers of the same good to collude with each other and form associations, also known as cartels.
Cartels are to be distinguished from other forms of collusion or anti-competitive organization, such as corporate mergers.

Purchasing

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An acquisition/takeover is the purchase of one business or company by another company or other business entity.

Verizon Communications

VerizonBell AtlanticGTE
The acquisition gave the company access to MCI's one million corporate clients and international holdings, expanding Verizon's presence into global markets.

Horizontal integration

horizontalhorizontal mergerhorizontally integrated
The most viable solution to this problem was for firms to merge, through horizontal integration, with other top firms in the market in order to control a large market share and thus successfully set a higher price.
A company may do this via internal expansion, acquisition or merger.

Acqui-hiring

talent acquisitionacqui-hireacqui-hired
Graham was probably the first to identify the trend in which large companies such as Google, Yahoo! or Microsoft were choosing to acquire startups instead of hiring new recruits, a process known as acqui-hiring.
Acqui-hiring or Acq-hiring is a neologism (a portmanteau of "acquisition" and "hiring"), or a talent acquisition, is the process of acquiring a company primarily to recruit its employees, rather than its products or services.

Verizon Wireless

VerizonBell Atlantic MobileBoulder
The joint venture was being created as Bell Atlantic underwent a merger with GTE Corporation.

AB InBev

Anheuser-Busch InBevAnheuser–Busch InBevABInBev
In 2004, Interbrew and AmBev merged, creating the world's largest brewer, InBev.