• The combination of two or more firms, in which the resulting firm maintains the identity of one of the firms, usually the larger one.

• (1) Acquisition in which all assets and liabilities are absorbed by the buyer. (2) More generally, any combination of two companies.

• The combination of two or more companies, generally by offering the stockholders of one company securities in the acquiring company in exchange for the surrender of their stock.

 Embedded terms in definition
 Acquiring company
 Referenced Terms
 Acquiring company: The firm in a Merger transaction that attempts to acquire another firm.

 Acquisition of assets: A Merger or consolidation in which an acquirer purchases the selling firm's assets.

 Acquisition of stock: A Merger or consolidation in which an acquirer purchases the acquiree's stock.

 Appraisal rights: A right of shareholders in a Merger to demand the payment of a fair price for their shares, as determined independently.

 Coinsurance effect: Refers to the fact that the Merger of two firms decreases the probability of default on either firm's debt.

 Related Terms
 Congeneric merger
Conglomerate merger
Financial merger
Friendly merger
Horizontal merger
Hostile merger
Strategic merger
Vertical merger

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