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Finance allah shmoop what's the difference between mergers and acquisitions

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all right people listen up Merger that's what's about to

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happen here it's a merger acquisition that's what's about to

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happen here Corporate america is kind of same thing when

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two companies merge while they generally you know attracted to

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each other hopefully respect each other they share stock or

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combined the stocks of each side and you know combine

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efforts and then and then cuddle afterwards if they're successful

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at the merger than the combination of two roughly equals

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yields more than the one plus one combo that made

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them so two companies get together on generally equal ish

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footing In that case acquisitions are a combining more like

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that eating thing on much different footing The large company

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eats or buys the target either using its more highly

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valued stock currency or it's taft to do so Well

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why would a company acquire another Well the target might

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have one hundred employees ninety of whom can be fired

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with massive expense savings after the acquisition For the acquirer

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such that economically the acquisition won't just makes a whole

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lot of financial sense acquisitions happen for market power reasons

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As well like imagine the negotiating leverage that amazon would

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have if it bought the next five biggest online retailers

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Or maybe it'll just kill them Probably not legal for

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them to buy him anyway given the monopoly like dominance

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of amazon these days But wow that would be a

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powerful set of acquisitions And that would be a good

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reason for ems on to acquire a whole bunch Things

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and bezos would grow even more powerful maybe too powerful

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