Editing Mergers and acquisitions (section)

{{short description|Type of corporate transaction}}
{{For|The Sopranos episode|Mergers and Acquisitions (The Sopranos)}}
{{other uses|Merge (disambiguation){{!}}Merge|Acquisition (disambiguation){{!}}Acquisition}}
{{Corporate finance}}

'''Mergers and acquisitions''' ('''M&A''') are business transactions in which the ownership of a [[company]], [[List of legal entity types by country|business organization]], or one of their operating units is transferred to or [[Consolidation (business)|consolidated]] with another entity. They may happen through direct absorption, a merger, a tender offer or a hostile takeover.<ref>{{Cite web |title=Mergers and Acquisitions (M&A): Types, Structures, Valuations |url=https://www.investopedia.com/terms/m/mergersandacquisitions.asp |access-date=2024-04-12 |website=Investopedia |language=en}}</ref> As an aspect of [[strategic management]], M&A can allow enterprises to grow or [[Layoff|downsize]], and change the nature of their business or competitive position.

Technically, a {{em|merger}} is the legal consolidation of two business entities into one, whereas an {{em|acquisition}} occurs when one entity takes ownership of another entity's [[share capital]], [[equity (finance)|equity interests]] or [[asset]]s. From a legal and financial point of view, both mergers and acquisitions generally result in the consolidation of assets and [[Liability (financial accounting)|liabilities]] under one entity, and the distinction between the two is not always clear.

Most countries require mergers and acquisitions to comply with [[United States antitrust law|antitrust]] or [[competition law]]. In the [[United States]], for example, the [[Clayton Antitrust Act of 1914|Clayton Act]] outlaws any merger or acquisition that may "substantially lessen competition" or "tend to create a [[monopoly]]", and the [[Hart–Scott–Rodino Antitrust Improvements Act|Hart–Scott–Rodino Act]] requires notifying the [[United States Department of Justice|U.S. Department of Justice]]'s [[United States Department of Justice Antitrust Division|Antitrust Division]] and the [[Federal Trade Commission]] about any merger or acquisition over a certain size.