Merger and acquisition deals are transactions that are considered to be part of corporate finance, actually being one of the most important fields of corporate affairs.
Mergers and acquisitions are deals that two separate entities enter to consolidate their operations and their positions in their niche. These transactions can take place in many different ways. Mergers typically involve two companies that create a new, third one that incorporates either parts of the two merging companies or involve the complete dissolution of the two into the new business. Acquisitions, on the other hand, are transactions in which one company purchases the shares, the assets and the operations of another one. The two companies involved in mergers and acquisitions can operate in the same niche or industry or they can operate in different, unrelated industries.
There can be many reasons to motivate mergers and acquisitions. Top rated M&A advisors confirm that these deals can be considered beneficial because they can improve the performance of one or of both participants, they can increase the market share of the new structure or they can diversify product ranges and ensure access to new markets. A company might decide to merge with another one or to acquire another one to increase revenues or to lower expenses as well.