merger

(redirected from Business Combinations)
Also found in: Dictionary, Thesaurus, Medical, Legal, Financial.

merger,

in corporate business, fusion of two or more corporations by the transfer of all property to a single corporation. The remaining corporation continues in existence, having absorbed the other(s). Mergers may be of various types: A vertical merger integrates different types of businesses that may share a supplier-customer relationship; a horizontal merger brings together related businesses; an extensional merger. joins two similar businesses to enter a new market; and a hostile takeover occurs when a stronger business absorbs another against its will. The methods of effecting mergers vary. Often the corporation that continues to function makes an outright purchase of the property and stock of the others; exchange of bonds, options, and other agreements are also employed by the corporations involved.

Mergers may be effected to increase profits and reduce losses through the reduction of competition, to diversify production, to protect against the liabilities of concentration in a single area, or to revive or rejuvenate failing businesses by the infusion of new management and personnel. Mergers for monopolistic purposes were among the unfair practices that the Sherman Antitrust ActSherman Antitrust Act,
1890, first measure passed by the U.S. Congress to prohibit trusts; it was named for Senator John Sherman. Prior to its enactment, various states had passed similar laws, but they were limited to intrastate businesses.
..... Click the link for more information.
 (1890) and, more especially, the Clayton Antitrust ActClayton Antitrust Act,
1914, passed by the U.S. Congress as an amendment to clarify and supplement the Sherman Antitrust Act of 1890. It was drafted by Henry De Lamar Clayton.
..... Click the link for more information.
 (1914) attempted to correct. The international nature of many modern corporations now also subjects mergers to antitrust scrutiny overseas, particularly in the European Union.

The end of the 20th cent. witnessed a great increase in mergers; in the United States alone, 60,375 mergers involving a total of over $4.5 trillion occurred between 1980 and 1996. Among the largest recent U.S. mergers are those between America Online and Time Warner (2000; $165 billion, but worth significantly less after the bubble in Internet-related stocks collapsed), Exxon and Mobil (1999; $81 billion); Citicorp and Travelers Corp. (1998; $72.6 billion), AT&T and Bell South (2006; $67 billion), SBC Communications and Ameritech (1998; $60.1 billion), and AT&T and TCI (1999; $48 billion).

See also conglomerateconglomerate,
corporation whose asset growth, often very rapid, comes largely through the acquisition of, or merger with, other firms whose products are largely unrelated to each other or to that of the parent company.
..... Click the link for more information.
.

merger

The final gravitationally bound product of closely interacting galaxies or other interacting systems. Some IRAS galaxies are believed to be recent merger products.

Merger

 

the combining of two or more joint-stock companies, a form of centralization of capital under imperialism. The production of the merging companies may be identical or similar innature (see alsoAMALGAMATION IN ECONOMICS).

merger

1. Commerce the combination of two or more companies, either by the creation of a new organization or by absorption by one of the others
2. Law the extinguishment of an estate, interest, contract, right, offence, etc., by its absorption into a greater one
References in periodicals archive ?
In the USA, the history of regulation regarding accounting for business combinations started with APB Opinion No.
The jointly developed EDs on business combinations are a product of two phases.
We describe our perspective on the desired attributes of a general business combinations standard followed by an overall evaluation of the ED from this perspective.
In some business combinations, the combined entity assumes the name of the acquired entity.
The end-of-chapter materials are similar in style to those in the business combinations chapters.
This leads to some curious Catch-22s, as in France, where takeover laws designed to streamline business combinations forbid firms to make a bid conditional on regulatory approval, while EU law forbids the combination to go ahead without it.
FAS 141 is effective for all business combinations initiated after June 30,2001, and for all purchase business combinations for which the date of acquisition is July 1,2001 or later.
were concerned that the opportunity to reduce income tax expense in future years for a portion of acquired tax benefits might sometimes influence purchase price allocations for business combinations." [Paragraph 126.] Purchase price allocations in business transactions are a result of arm's-length negotiations and are often subject to close Internal Revenue Service scrutiny.
generally accepted accounting principles." The International Accounting Standards Board plans to issue its counterpart standards IFRS 3 (revised), Business Combinations, and IAS 27 (Revised), Consolidated and Separate Financial Statements, early this year.
The International Accounting Standards Board (IASB) and FASB are jointly working on a Business Combinations project.
141 is likely to be replaced by the recently Proposed Statement of Financial Accounting Standards, Business Combinations. The International Accounting Standards Board has issued a proposed statement that would replace IASB Statement No.

Full browser ?