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  1. #1


    I need help, the differences between merger and acquisition are:

    Acquisition: the acquiring company wants to control the target company , e.g. acquiring a majority of the voting shares in that company but at the same time both company can remain independent legal entities.
    Merger: taking over a company, either forming a new one company(e.g. 1+2=3,they lose their identity) or the merger assumes the liabilities and assets of the target.(1+2=1)

    What does it mean the acquiring company, I think, this is this one, which wants to take over another one, don't you?
    2)1+2=1 here is the acquiring company the first, isn't it, 2 is the target

    And what does it mean "consolidation"

  2. BobK's Avatar
    Harmless drudge
    English Teacher
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    Re: merger+acquisition

    You have it right. But the situation is complicated by people not wanting to lose face. I started working for DEC in the mid '80s, and about 10 yrs later they were acquired by the relative newcomer Compaq. But all the internal FAQs we were fed had:

    Q Is this a merger or an acquisition?
    A It is a merger... [blah, blah, blah...]

    If you've read '1984', you'll have met the concept 'doublethink. Somehow, the people who organized the acquisition found a way to bend the language so that the could justify the use of the word 'merger'. It made the few surviving DEC board-members feel better.

    A few years later, HP acquired Compaq. Same story, even down to the logic-chopping internal FAQs.

    The moral of my story is, hang on to your understanding of the difference between an acquisition and a merger, but treat with a bucketful of salt anything that the resulting company says about it.


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