Mergers Flashcards
1
Q
A horizontal merger is between:
A
Two firms in the same line of business
2
Q
A vertical merger involves companies:
A
At different stages of production
3
Q
A conglomerate merger involves companies:
A
In unrelated lines of business
4
Q
What are some sensible reasons for mergers?
A
- EOS
- EO vertical integration
- Complementary resources
- Surplus funds
- Eliminate inefficiencies
5
Q
Who usually benefits from a merger?
A
- Shareholders of the target
- Lawyers and brokers
- Executives of the acquiring firm
6
Q
Who usually loses out in a merger?
A
- Shareholders of the acquirer
- Executives of the target
- Employees
