Merger

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A merger in business or economics refers to the combination of two companies into one larger company. Such actions are commonly voluntary and often involve stock swap. In many instances a merger resembles a takeover but often results in a new company name (often combining the names of the original companies) and in new branding.

Classifications of mergers:

Horizontal mergers take place where the two merging companies both produce similar product in the same industry.
Vertical mergers occur when two firms, each working at different stages in the production of the same good, combine.
Conglomerate mergers take place when the two firms operate in different industries.

The occurrence of a merger often raises concerns in anti-trust circles. Devices such as the Herfindahl index can analyze the impact of a merger on a market and what, if any, action could prevent it. The Department of Justice and the Federal Trade Commission investigates anti-trust cases, monopolies, and approves mergers.

A unique type of merger called a reverse merger is used as a way of going public without the expense and time required by an IPO.

Compare mergers and acquisitions.

Famous mergers include:

Merger in Criminal law characterises situations where one crime subsumes another. See Doctrine of Merger