Question

The difference between a merger and an acquisition is: Select one: a. That a merger involves one company purchasing the assets of another company with cash, whereas an acquisition involves one company becoming the owner of another company by buying all of the shares of its common stock. b. That a merger is the combining of two or more companies into a single corporate entity (with the newly created company often taking on a new name), whereas an acquisition is a combination in which one company, the acquirer, purchases and absorbs the operations of another, the acquired. c. That the brands of both companies are retained in a merger, whereas with an acquisition there is only one surviving brand name. d. Basically a play on words—in both instances, two companies become one, and the terms "merger" and "acquisition" are synonymous.

Answer 1

Answer: b. That a merger is the combining of two or more companies into a single corporate entity (with the newly created company often taking on a new name), whereas an acquisition is a combination in which one company, the acquirer, purchases and absorbs the operations of another, the acquired.

Explanation:

A MERGER is merger is a process where we see two firms which are usually of the same size joining forces to move forward as a new entity. This is usually called a "MERGER OF EQUALS".

An Acquisition on the other hand involves the taking over of one company by another with the latter becoming the new OWNERS and legally the former ceases to exist.

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Answer 2

Answer:

b) That a merger is the combining of two or more companies into a single corporate entity, whereas an acquisition is a combination in which one company, the acquirer, purchases and absorbs the operations of another, the acquired.

Explanation:

Merger is when two or more companies join together either for survival purposes or could have same operations and or operating in the same industry but it it the combination of two or more to get a single entity.

Acquisition is the purchase of one entity by another, both entities could remain operating the same in different ways or places but the owner of acquired changes.