Mergers

A Merger can exist between any number of Legally Incorporated entities, listed or unlisted. There are several motivations to merge, Market Share, Efficiency Gains and a Defensive Strategy.

A merger involves two or more existing Companies, listed or private, even with different corporate structures, being merged into one Company. Merging Companies can be defined under the types of Mergers and then the key Motivations to Merge. The different types of Mergers are Vertical, Horizontal, Conglomerate, Congeneric, Accretive, Dilutive and a Reverse Merger. A common motivation is to gain market share, to have the ability to cross sell and become more efficient. The other main motivation is to defend a market position against competitors. Should one invest in companies likely to merge with another? A merger between two entities, no matter the size, is a process and sometimes a long and possibly a painful process. The real goal as an investor is to understand the logic put forward by Management.