Mergers and acquisitions of companies are an aggregationcapital and business, which occurs at the level of macro- and microeconomics. As a result of these processes, not very significant firms disappear from the market, and large ones appear instead.
1) Merger of assets. The owners of the companies participating in the association transfer (as their contribution) the right to control their organizations. But at the same time, companies continue to operate and retain all rights.
2) Merging forms. Companies that have merged into one are no longer legal entities and tax payers. Assets and obligations to clients are beginning to be managed by a new, newly formed organization.
3) Accession. In this case, some of the merged companies function as before, while the rest cease to exist, all their duties and rights pass to the remaining organization.
Merger of companies: classification
By the nature of the integration of firms distinguish:
1) Vertical fusion. It is the union of several companies, in which one of them supplies raw materials for another. The cost price of the output, of course, in this case falls sharply, and the profit, accordingly, increases.
2) Horizontal merge. Unite such companies that produce the same goods. Together they can develop better, competition considerably decreases.
3) Parallel fusion. Unite companies that produce products interconnected. For example, one company produces printers, and the other - paint for them.
5) Reorganization - the merger of such companies that are involved in different business areas.
Depending on how the management of the firm relates to the transaction, there are:
1) Hostile mergers.
2) Friendly.
Merger of companies: motives for the transaction
They are built on the basis of conflicts between the interests of the manager and the owner. And this does not always take into account economic expediency. So, the motives are:
1) Striving for constant growth.
2) Individual motives of the manager.
3) Increasing the scale of production.
4) The desire to provide positive indicators for a short period.
Impact on the economy of the country
Most economists argue that the mergercompanies and their absorption is a common phenomenon for a market system. Moreover, such a permutation is even useful to prevent stagnation and make business more efficient. But that's not what everyone thinks. Some executives of firms assert that both absorption and merger of companies absolutely do not contribute to the development of the nation's economy. They, on the contrary, make competition dishonest and means distract not for progress, but for permanent defense and struggle.
