Mergers & Acquisitions - Some definitions

• Acquisitions: purchase of some portion of one company.
• Merger: absorption of one company by other.
• Statuary merger: acquirer acquires all target’s assets.
• Subsidiary merger: target becomes subsidiary after purchase.
• Consolidation: both cease to exist to become a new company.
• Target Company: one being acquired.
• Acquiring company: company acquiring target.
• Hostile transaction: potential business combinations without management & board’s consent.
• Friendly transaction: business combinations approved by management of both companies.
• Horizontal merger: merging companies in same kind of business.
• Vertical merger: companies at different position in same value chain.
• Backward integration: acquirer purchases target ahead of it in value chain.
• Forward integration: acquirer purchases target further down the value chain.
• Conglomerate merger: Acquires purchasing target unrelated to its core business.