Mergers and acquisitions (M&As) is a phrase used to describe a host of financial activities in which companies are bought and sold. In an acquisition one party buys another by acquiring all of its assets. The acquired entity ceases to exist as a corporate body, but the buyer sometimes retains the name of the acquired company, indeed may use it as its own name. In a merger a new entity is created from the assets of two companies; new stock is issued. Mergers are more common when the parties have similar size and power. Sometimes acquisitions are labeled “mergers” because “being acquired” carries a negative connotation (like “being eaten”); a merger suggests mutuality. M&A activity involves both privately held and publicly traded companies; acquisitions may be friendly (both entities are willing) or may be hostile (the buyer is opposed by the management of the acquisition target).
Valuation of Business
Valuation of Goodwill