Acquisition: If a company buys another company outright, or accumulates enough shares to take a controlling interest, the deal is described as an acquisition. The acquiring company's motive may be to expand the scope of its products and services, to make itself a major player in its sector, or to fend off being taken over itself. To complete the deal, the acquirer may be willing to pay a higher price per share than the price at which the stock is currently trading. That means shareholders of the target company may realize a substantial gain, so some investors are always on the lookout for companies that seem ripe for acquisition. Sometimes acquisitions are described, more bluntly, as takeovers and other times, more diplomatically, as mergers. Collectively, these activities are referred to as mergers and acquisitions, or M&A, to those in the business.

 

Related Words

Acquisition: The purchase of one organization by another organization.

Growth And Acquisition (G and A): Describes a way a company can grow. Growth means expanding through its normal operations, Acquisition means growth through buying up other companies.

Acquisition Of Stock: A merger or consolidation in which an acquirer purchases the acquiree's stock.

Acquisition Of Assets: A merger or consolidation in which an acquirer purchases the selling firm's assets.