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Is there only one kind of business merger?

Camden readers may generally know that when two things merge together they become a single entity. Mergers are an integral part of the business world where corporations regularly split, combine and form new organizations. However, mergers do not occur by simply pushing two companies together under one heading; business mergers can take on a variety of forms.

The Minority Business Development Agency, operated through the United States Department of Commerce offers a good explanation of some of the types of mergers companies can undergo. A conglomerate merger can form when the joining entities do not have factors in common; when companies from the same industry join together their union can be called a horizontal merger.

When two organizations operate in the same market with similar services but capitalize on different geographic areas, their merger can be termed a market extension merger. A product extension merger involves a merger between entities that produce related products and offer those products to the same customers in a market. A final form of merger that two companies may take on is a vertical merger, where the joining groups each produce items that are used in a combined final good or service.

These truncated descriptions of different types of mergers should not be relied on as complete explanations of what amounts to a complex area of business law. What readers may take away from this post, however, is that a business merger can happen both between a variety of companies and to achieve many different business goals. Those who want to learn more about mergers or how to go about buying a company may choose to use professional legal help to effectuate their business law plans.

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