Also called a buyout or takeover, acquisitions are the process by which one company purchases another company, often changing the name to match their own, to expand its profits, market share or operations.
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- An acquisition may be friendly, in which case the company taken over cooperates in the deal. Hostile acquisitions, or hostile takeovers, occur when one company buys another without consent or cooperation.
- Often, when a company is bought, there may be massive layoffs, and many of the top executives will be replaced at a rate much higher than average.
- Acquisitions allow a company to expand their operations without creating another company, or having to set up new corporate infrastructure.
- Acquisitions are often synonymous with mergers, but in a merger, both companies emerge with their corporate branding and infrastructure relatively intact, or a hybrid is created.
- Corporations will sometime employ specialized transition firms to advise them on how to perform a smooth acquisition. These firms are strictly advisers and do not provide financing.
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