Difference Between Merger and Consolidation

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Merger: A merger is a corporate strategy to combine with another company and operate as a

single legal entity. The companies agreeing to mergers are typically equal in terms of size and
scale of operations.

Difference between merger and Consolidation


Merger Consolidation
Merger involves a combination of two firms Consolidation involves the creations of an
such that only one survives. altogether new firm owing the asset of both of
the first and neither of the first two survive.
Merger tend to occur when one frim is Consolidation tend to occur when the two firms
significantly larger than other and the survivor are of approximately equal size.
is usually the larger of the two.

It happens when two or more companies come It happens when different ventures come
together and combine forces. together and combine forces into a better and
strong venture.
The Company absorbed cease to exist All the companies involved will cease to exist.

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