Mergers, Amalgamations and Takeovers

Prepare the corporate legal documents you need to merge or amalgamate two or more related companies with these ready-made Amalgamation and Merger Forms.

 

Q. What is an amalgamation?

A. An amalgamation is the combination of two or more related companies. The amalgamated entity typically takes on the identity of the larger and more financially stable of the amalgamating entities. The shareholders of each company become the shareholders of the amalgamated company, and the assets and liabilities of the merged companies are vested in the amalgamated company.

Q. What is a merger?

A. A merger is the formation of a new company from two or more existing companies, through pooling of common stock, cash payment or a combination of both. The companies being merged cease to exist and the shareholders of those companies become the shareholders of the new company.

Q. What is a takeover?

A. The term takeover is generally used to refer to an acquisition where the company being acquired is resisting the takeover, otherwise known as a 'hostile takeover'. This is accomplished by bypassing the board of directors and making a tender offer directly to the shareholders. If the offer to purchase their shares is sufficient to influence them, a majority of the shareholders may decide to approve the takeover, notwithstanding that the directors and management oppose it.

Many companies have employed defenses against corporate takeover, such as instituting a shareholders' rights plan which allows shareholders to purchase additional stock at a reduced price, resulting in a higher number of shareholders. However, these strategies can have the negative effect of lowering the stock price and diluting the shares.

Sub Categories

View as Grid List
Sort by
Display per page

Documents