What are the differences between a merger and an acquisition?

A merger and an acquisition are both terms used to describe the process of consolidating two companies. However, there are distinct differences between the two. A merger occurs when two companies enter into a formal agreement to combine their assets, liabilities and operations into one organization. The newly created entity is typically referred to as a merger partner. Both companies are considered to be completely equal in a merger and each retains its own corporate structure and identity. An acquisition occurs when one company purchases the assets of the other company. It is usually used when one company has a competitive advantage over another. In an acquisition, the company being purchased is referred to as the target company, while the acquiring company is called the acquirer. In this case, the target company ceases to exist as an independent entity and its assets and liabilities are transferred to the acquirer. In either case, the companies involved may be subject to certain legal requirements under District of Columbia Mergers and Acquisitions Law. This includes filing a notice of the transaction to the local district court, as well as providing certain information to the public. In some cases, the local court may require company leaders to appear for a hearing and answer questions about the transaction. Overall, mergers and acquisitions are two distinct processes with different implications for the companies involved. Mergers involve a combined entity, while acquisitions involve one company taking over the assets of another. Both processes require compliance with District of Columbia Mergers and Acquisitions Law.

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What are the differences between a merger and an acquisition?

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