Asked by denice cuellar on May 27, 2024
Verified
Describe the three types of mergers and give real-world examples.
Mergers
The process by which two or more companies combine into a single entity, often to achieve greater market share, efficiency, or competitive advantage.
Real-world Examples
Specific, actual case studies or instances used to illustrate a concept or to demonstrate how theoretical principles operate in practice.
Types
Different categories or varieties of objects, concepts, or entities distinguished by specific attributes or characteristics.
- Comprehend the characteristics and control of mergers, encompassing horizontal, vertical, and conglomerate categories.
Verified Answer
MF
Miguel FortunaMay 28, 2024
Final Answer :
A horizontal merger occurs between two competitors that sell similar products in the same geographic market. A real-world example of such mergers is Heinz purchasing Kraft. A vertical merger occurs between firms at different stages of the production process. Vertical mergers are mergers between firms that have buyer-seller relationships. A real-world example of such mergers are PepsiCo's mergers with Pizza Hut, Taco Bell, and KFC. PepsiCo supplies soft drinks to each of these fast-food outlets. A conglomerate merger is any merger that is not horizontal or vertical; in general, it is the combination of firms in different industries or firms operating in different geographic areas. Conglomerate mergers can extend the line of products sold, extend the territory in which products are sold, or combine totally unrelated companies. A real-world example of conglomerate mergers is the merger between Amazon (e-commerce)and the Whole Foods Markets (supermarkets).
Learning Objectives
- Comprehend the characteristics and control of mergers, encompassing horizontal, vertical, and conglomerate categories.