In corporate finance,
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. 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. M&A can include a number
of different transactions, such as mergers, acquisitions, consolidations,
tender offers, purchase of assets and management acquisitions. In all cases,
two companies are involved.From a legal point of view, a merger is a legal
consolidation of two entities into one, whereas an acquisition occurs when one
entity takes ownership of another entity's stock, equity interests or assets.
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. So, this process require a great deal of knowledge and resources
to handle smooth transactions. |