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Business

Andrew Barnett Explains The Different Types Of Mergers And Acquisitions

Andrew Barnett possesses ample entrepreneurial background in several industries. He has developed procedures for Reader’s Digest at Puerto Rico and Vistacolor’s Miami facilities. In 1999, he presided over the post of the vice president of Dollarsignz. This company is a sign and printing business for outdoor and indoor large-scale buildings.

In 2007, Andrew Barnett helped McDermit Colorspan in the testing of biodegradable inks in ultraviolet printing. Presently, Mr. Barnett owns as well as manages Andrew Barnett Mergers and Acquisitions in Fort Lauderdale.

About Mergers

Mergers happen when two or more than two firms combine to create one entity. It is described as a ‘transaction that involves two or more firms in the exchange of securities”. Only one company survives in this transaction.

About Acquisition

The is a procedure to gain authority over the target firm by obtaining assets or obtaining control over the board. This happens without the physical merger of businesses.

Types of Mergers and Acquisitions

Companies will combine and acquire other companies due to various types of reasons. Regardless of the reason, they merge and acquire in the four main ways:

  • Horizontal Combination and Acquisition

In this type of M&A, two companies merge with similar types of products and services. It helps them expand their range without doing anything new. The major objective is to become a leading supplier of the personal computer by combining the computer products of both types of companies.

  • Vertical Merger or Acquisition

In this type of merger and acquisition, two firms that belong to the same industry but lie at different places on the supply chain, combine together. They become vertically integrated by the enhancement of logistics. They consolidate staff and provide products quickly to the market.

  • Conglomerate Merger and Acquisition

Two firms that belong to different industries combine forces to widen their array of products and services. This can also happen when one company takes over the other company in order.

By the combination of back-office activities and lowering risks by executing in an array of industries, the Conglomerate Merger and Acquisition approach helps in the reduction of costs.

Mergers based on Controlling Interest

When the receiving company acquires the target firm by mutual agreement and determination, it is called a friendly merger. This type of merger offers a variety of advantages for the target firm especially in the area of pricing. The price that the company offers is always greater than the market price.

Conclusion

Mergers and acquisitions happen in the business in various types. Businesses do it to accomplish different types of aims in the business. Whatever be the objective, M&A consulting firms help in the best accomplishment of the task.

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