A merger, is by definition, the combining of two or more companies into one (generally termed either the “survivor” of the merger or the “consolidated entity”) generally by offering the stockholders of one company securities in the acquiring entity (i.e., the survivor or consolidated entity) in exchange for the surrender of their stock. The decision to merge and the structure of the merger is usually mutual and is negotiated between each of the participating companies.
The incentive to merge is generally a synergy or complementary between the two companies, or in order to consolidate and dominate an otherwise fragmented industry. At times, mergers are between or among companies in different countries. Public companies may merge with other public or private companies and private companies can merge with other private companies.
Global Edge can advise and assist you in locating a suitable merger participant (depending upon your specific objective) or participants, negotiating the terms of exchange, structuring the transaction, managing the consolidation process and with financing, if financing is applicable. Some of our clients have been private companies which merged with publicly-traded entities simply in order to become publicly-traded – these types of transactions are frequently referred to as “reverse mergers” if the private company has greater asset value or profitability than the publicly-traded company, which may be a mature company or simply the publicly-traded “shell” of a company which has limited actual operations. Sometimes the merger is desirable in order to either horizontally or vertically integrate companies to reduce fixed costs and to increase market share. Should you be interested in a pre-merger IPO or post-merger IPO, Global can get you to the right investment banking firm and negotiate the terms most favorable to your company in terms of its valuation. We’ll also serve as your representative and expediter in terms of getting your deal subscribed and fully funded.