Acquisitions

RECENT NEWS
Reuters  4 hrs ago  Comment 
Spanish toll road operator Abertis has promised an enlarged 1 billion euros ($1.1 billion) share buyback as it continues a global search for the motorway acquisitions which it...
Clusterstock  8 hrs ago  Comment 
Shares in Quintain Estates are going absolutely nuts rights now after American private equity fund Lone Star made a £700 million ($1.1 billion) bid for the company. The 131p a share offer has sent Quintain shares jumping 23%, or 25.37p to...
The Australian  Jul 29  Comment 
Shares in Turkey-focused gold miner Alacer Gold have gained more than 6pc amid renewed takeover speculation.
Reuters  Jul 29  Comment 
Quintain Estates and Development Plc is in talks to be bought by private equity firm Lone Star Funds in a deal that could value the London property group at more than 600 million pounds...
Reuters  Jul 28  Comment 
U.S. private equity group Carlyle has closed its fourth European buyout fund, sticking to a so-called hard cap of 3.5 billion euros ($3.87 billion) after attracting far more...
Reuters  Jul 28  Comment 
The following bids, mergers, acquisitions and disposals were reported by 2000 GMT on Tuesday:




 
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Acquisitions are the purchase a controlling stake in another company by purchasing 51 percent or more of its voting shares with cash, stock, or a combination of the two.

Mergers and acquisitions are two closely related terms and are often listed together on a company's balance sheet as mergers and acquisitions (M&A). But there is an important distinction between these terms - in a merger, two companies become one and both original companies cease to exist; in an acquisition, the acquired company is absorbed by the acquiring company, and only the acquired company ceases to exist.

An acquisition, also sometimes called a takeover or buyout, usually involves the takeover of a smaller firm by a larger one. But there are occasions when a smaller firm will obtain the management control of a larger company, and in these cases the smaller acquiring firm will often keep the existing company name and brand in place for the new, combined company. Takeovers or acquisitions can be friendly, where the management of the company to be acquired negotiates a deal with the acquiring company; or, they can be hostile, where the takeover is made despite opposition by the company's management or an offer is made without prior knowledge by the company's board of directors.

Examples

An acquisition can be carried out in one of two ways:

  • The acquiring company buys the shares of the acquired company and obtains ownership control.
  • The acquiring company buys the assets of the acquired company, and the cash that the acquired company receives in return is paid to shareholders through a divided or by liquidating the company. If the acquiring company buys the entire assets of the acquired company, this leaves the acquired company as an empty shell which is eventually liquidated or enters another line of business.
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