What are the differences between a merger and an acquisition?

Mergers and acquisitions are business transactions that involve the combination of two or more companies. The terms “merger” and “acquisition” refer to the process of combining two separate entities into one. A merger occurs when two companies combine to form a single new company. The shareholders of both companies will receive a combination of stocks and cash for their shares of their respective companies. In a merger, both companies become one and operate as a single entity. An acquisition occurs when one company buys or acquires another company. This process may involve the buyer purchasing all of the existing shares of the company, or just a controlling interest. With an acquisition, the company that is acquired ceases to exist, and the acquiring company absorbs the assets and operations of the acquired company. The main difference between a merger and an acquisition is that in a merger two companies become one, while in an acquisition one company is purchased by another. Mergers and acquisitions are both governed by Mergers and Acquisitions Law in Pennsylvania. All merger and acquisition activity must be compliant with the relevant laws of the state. This includes compliance with antitrust laws, securities laws, and corporate governance requirements.

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What are the differences between a merger and an acquisition?

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