The term merger Essay Example | Topics and Well Written Essays - 500 words

The term merger - Essay Example 2. Forward/backward integration: By merging itself with a client or a vendor company, a company can result in assured raw materials/sales, minimize uncertainty and get better pricing. For example, an Iron and Steel manufacturer may merge itself with a mining company to secure its raw material supply. 3. Expanding product/services bouquet: By merging with similar but non competing firms, companies can increase their product offering, enter new markets and cross sell their products. For example, a website development firm may merge itself with an Internet analytics and Internet marketing firm and cross sell its services. Similarly, a Iron and steel manufacturing company may merge with a Sheet rolling company to move up the value chain. 4. Expanding in other geographical markets: Business organizations also use cross border mergers and acquisitions to expand into new geographical markets. Mergers and acquisitions are perhaps the fastest way of entering a new geographical market. There have been numerous studies and researches conducted that tried to enumerate the reasons behind successful mergers.