Austin Merger and Acquisition Lawyer

Mergers and Acquisitions

The term merger and acquisition may frequently appear as a synonymous phrase, but the two terms do have different meanings. Regardless, the motivation behind making either business move lays in the theory of synergy.

Acquisition

An acquisition is a purchase in which one company takes over another and clearly establishes itself as the new owner. The target company that was purchased ceases to exist from a legal stand point. On the other hand, the buyer consumes the business and the buyer’s stock continues to be traded.

Merger

Less often, firms of about the same size will reach an agreement to continue business as a new single company. This is more adequately described as a merger of equals. In this situation, both companies stocks are surrendered and new company stock is issued in its place.

Synergy

Synergy is what allows for greater cost efficiencies in a merger or acquisition. It takes the form of revenue enhancement and cost savings. Reductions in staff, economies of scale, acquiring new technology, and improved market reach and industry visibility all combine to promote the idea of greater cost efficiency.

If you are a business owner considering a merger and acquisition, the guidance of dedicated legal professionals could make the difference between failure and success.

Speak with an Austin Merger and Acquisition Lawyer

Contact the Austin merger and acquisition lawyers of Slater, Kennon & Jameson, LLP at 512.472.2431 to speak to an attorney with the experience that this special area of law requires. We are a law firm that knows business.