Mergers and Acquisition (M&A) Law deals with the laws affecting the purchase of one company by another (an acquisition), or the blending of two companies into a new entity (a merger).
Merger
A merger is a process by which two companies join and one new company continues to exist. Also called a consolidation, a merger occurs when two companies combine together to form a new enterprise altogether, and neither of the previous companies remains independently.
Acquisition
Acquisitions involve a process by which one company acquires the assets of another company. An acquisition, or takeover, is the purchase of one business or company by another. Acquisitions are usually divided into either "private" and "public" acquisitions. The distinction depends on whether the stocks of the target company is publicly traded or not. Acquisitions can also be categorized as “friendly” or “hostile” depending on how the target company perceives the acquirer.
Federal Trade Commission
The Federal Trade Commission (FTC) ensures that these transactions are compliant with fair competition and antitrust laws. There are always concerns about anti-competitive behavior in these transactions, and the consolidation of too large a portion of the market share in a single entity.
Securities and Exchange Commission
The Securities and Exchange Commission (SEC) also plays a role in these transactions, ensuring that a purchase is not made via illegal activities such as insider trading, improperly devalued stocks, or other inappropriate conduct.
M&A Industry
Because of the unique complexities of the mergers-and-acquisitions process, a unique industry has grown up around it with a number of law firms, accountants, stock brokers, and other business experts dedicating their practices to it. If you have questions about the laws relating to mergers-and-acquisitions, you can review the materials below for additional information. Moreover, you can contact an attorney in your area specializing in M&As by visiting our Law Firms page.
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