Mergers and Acquisitions (M&A)

Definition

Mergers and acquisitions (M&A) are transactions between two companies that decide to combine in some form to create a single entity.In an acquisition, a larger company generally acquires a smaller one to absorb the business for further expansion. M&A deals may be hostile or friendly, depending on the target company's management approval.

Example

Some popular M&A deals of the last few decades are Google’s Android acquisition, Disney’s Pixar and Marvel acquisitions, and the merger of Exxon and Mobile.

Why it matters

Some of the benefits of Mergers and Acquisitions are:a. It helps in generating economies of scaleb. Better synergies c. Opportunistic value creationd. Enhanced market sharee. Access to vast talent poolf. Tax benefits

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