Acquisition
From MarketsWiki
| This page is not complete! |
| Do you have knowledge to contribute on this or other subjects?
Sign up to add what you know or suggest a page, provide content or sources. |
ALSO SEE: merger
An acquisition is the purchase of one company by another. It is also sometimes called a takeover. The term "takeover" is more commonly used to describe a hostile acquisition, in which the target company does not want to be bought. In a "friendly" acquisition, companies cooperate in negotiations and come to an agreement on terms. The acquiring company assumes control of the target company, usually paying in cash, the acquirer's stock, or a combination of the two. The acquiring company often pays a premium on the target company's market price in order to persuade shareholders to sell.[1]
Most acquisitions involve a larger company buying a smaller one. Sometimes a smaller firm will take over the management of a larger one; this is called a reverse takeover.
References
- ↑ Acquisition. Investopedia. Retrieved on February 11, 2009.
