An Overview Of Post Merger Integration

INTRODUCTION

Mergers constitute a common approach undertaken in the business environment, which is the joining of two or more firms into one with the aim of making it possible to expand, increase productivity, or gain some competitive edge. This activity may take various forms that have a legal and financial basis.

Amongst the various forms of merger, a merge by absorption is one of the common process wherein one company purchases another and the focus company ceases to exist as an independent entity and their products, investments and activities are assimilated into the company acquiring them. The acquiring company does not change and is preserved with its organizational structure and name, only that it assimilates the resources of the 'absorbed' company. This form of merger is often sought with the intention to rationalize business activities, reduce competition, or grow into unfamiliar business lines without the need of setting up a new firm and create value