What are Mergers and Acquisitions?
Mergers and acquisitions is a phrase used to describe certain types of financial activities in which corporations are bought and sold. A merger occurs when two corporations merge, in other words, one absorbs the other. One corporation preserves its original charter and identity and continues to exist. The other corporation disappears, and its corporate existence terminates. Generally, the corporate entity which continues the business after a merger will succeed to all of the rights and property of the other entity and will also be subject to all of its debts and liabilities. A corporation may merely purchase or acquire the assets of another corporation. This would not be a merger In an acquisition, the purchaser does not become liable for the obligations of the business whose assets are being purchased.
