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Reference.org
Mergers and acquisitions
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<p>Mergers and acquisitions (M&A) are business transactions in which the ownership of a <a href="/facts/Company/psBVz9jr">company</a>, <a href="/facts/List_of_legal_entity_types_by_country/KB4c0dFB">business organization</a>, or one of their operating units is transferred to or <a href="/facts/Consolidation_(business)/neJVyvfq">consolidated</a> with another company or business organization. They may happen through direct absorption, a merger, a tender offer or a hostile takeover. As an aspect of <a href="/facts/Strategic_management/b4kFnS66">strategic management</a>, M&A can allow enterprises to grow or <a href="/facts/Layoff/8Nc5HRHV">downsize</a>, and change the nature of their business or competitive position. </p><p>Technically, a merger is the legal consolidation of two business entities into one, whereas an acquisition occurs when one entity takes ownership of another entity's <a href="/facts/Share_capital/JHuhfhaG">share capital</a>, <a href="/facts/Equity_(finance)/K5fBPIfS">equity interests</a> or <a href="/facts/Asset/o7TARXhB">assets</a>. From a legal and financial point of view, both mergers and acquisitions generally result in the consolidation of assets and <a href="/facts/Liability_(financial_accounting)/cvyGGW4w">liabilities</a> under one entity, and the distinction between the two is not always clear. </p><p>Most countries require mergers and acquisitions to comply with <a href="/facts/United_States_antitrust_law/Gr2aLDGj">antitrust</a> or <a href="/facts/Competition_law/cq7hKYN4">competition law</a>. In the <a href="/facts/United_States/P0sCdLe5">United States</a>, for example, the <a href="/facts/Clayton_Antitrust_Act_of_1914/191IwYdP">Clayton Act</a> outlaws any merger or acquisition that may "substantially lessen competition" or "tend to create a <a href="/facts/Monopoly/BXIQWUmR">monopoly</a>", and the <a href="/facts/Hart%E2%80%93Scott%E2%80%93Rodino_Antitrust_Improvements_Act/PJ7TYWJB">Hart–Scott–Rodino Act</a> requires notifying the <a href="/facts/United_States_Department_of_Justice/2SuTuevo">U.S. Department of Justice</a>'s <a href="/facts/United_States_Department_of_Justice_Antitrust_Division/II22BCm8">Antitrust Division</a> and the <a href="/facts/Federal_Trade_Commission/Hkz0PwF9">Federal Trade Commission</a> about any merger or acquisition over a certain size. </p>