Merger and acquisition examples

I am interested to know about the Merger. So here I want to get information about the Merger and acquisition examples. So here can you provide me information about it?

[Kiran Chandar]

As per your request here I am providing you information about it as you want.

Mergers and Acquisitions;
Mergers and acquisitions are both changes in control of companies; involve combining the operations of multiple entities into a single company.



Merger
The case when two companies (often of same size) decide to move forward as a single new company instead of operating business separately.

Mergers & acquisitions refer to the management, financing, and strategy involved with buying, selling, and combining companies.

The stocks of both the companies are surrendered, while new stocks are issued afresh.

For example,
Glaxo Well come and Smith Kline Beehcam ceased to exist and merged to become a new company, known as Glaxo Smith Kline.


Acquisition
The case when one company takes over another and establishes itself as the new owner of the business.

The buyer company “swallows” the business of the target company, which ceases to exist.

Dr. Reddy's Labs acquired Betapharm through an agreement amounting $597 million.

Merge
Companies would choose to merge together for different reasons:
The combined entity would be larger, and have corresponding larger resources for marketing, product expansion, and obtaining financing. This could help them better compete in the marketplace.

The combined entity could merge similar operations to reduce costs. Corporate and administrative functions, such as human resources and marketing, are often targets for combinations. They might also combine the production areas if the companies produce similar products and reduce costs by having fewer plants or facilities in operation.

The combined entity might have synergy in operations. Synergy is when combined operations show lower costs or higher profits than would be expected by just adding their financial information together on paper.

This could be due to economies of scale, where costs are lower due to higher volume of production, or due to vertical integration, where greater control over the production process is achieved due to owning more steps in the production process.

Acquire
Acquisitions are undertaken for strategic reasons. For example:
A company might acquire another company to obtain a specific product. It can be less expensive to purchase a company offering a product you'd like to sell than building the product yourself.

A company might acquire other companies to increase its size. A larger company may have more visibility in the marketplace, and also better access to credit and other resources.

A company might acquire another to obtain control over a critical resource.

For example, a jewelry company might acquire a gold mine, to ensure they have access to gold without market price fluctuations.