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Mergers and acquisitions is the expanded name for M&A: legally, a merger combines two entities into one surviving or new company, while an acquisition is a purchase of a target’s shares or assets by a buyer that remains a separate legal person.
In newspapers, “mergers and acquisitions” is a synonym for M&A. In a law firm, the words still matter.
A merger is a statutory combination: Company A and Company B become one legal entity (or a Newco). Shareholders of both typically end up owning the survivor, sometimes in an exchange ratio.
An acquisition is a purchase: Buyer Ltd acquires 100% (or control) of Target Ltd, or Target’s business assets, and Target’s sellers take cash, shares or mixed consideration. Buyer and (if shares remain) Target can stay distinct legal persons.
IFRS 3 then asks who the acquirer is for accounting — which can surprise people in a “merger of equals.”
Illustration only.
Two regional clinics, each worth about €20m of equity value, agree a statutory merger with a 50/50 exchange ratio into a Newco. No cash leaves the system; control is shared; employment contracts transfer by operation of law in many EU jurisdictions.
The same clinics could instead do an acquisition: Clinic Holdco buys 100% of Clinic B for €20m cash raised from a bank. Clinic B’s founder exits. Competition filings, tax and the SPA look completely different from the merger plan — yet both sit under “mergers and acquisitions.”
If the headline is about who paid whom, you are usually in acquisition-land. If it is about exchange ratios and a combined board, you are closer to a merger. Many “mergers” in mid-market Europe are in fact share-for-share acquisitions with a merger story in the press release.
Policy and academic language; explaining a process to a board that has never sold a company; classifying news (a divestiture is still M&A).
US “reverse triangular mergers” and UK schemes of arrangement are acquisition technologies wearing merger clothes. Always read the structure memo, not the title.
Dazur tags a file as sale of shares, sale of assets, merger, or carve-out because diligence lists, tax and valuation bridges are not interchangeable across those forms.