Types of Business Combinations.doc
2
Business Combinations T ype of Combination Actio ns of Acquiring Company Actions of Acquired Company Statutory merger through asset acquisition Acquires assets and often liabilities. Dissolves and goes out of business. Statutory merger through capital stock acquisition. Acquires all stock and then transfers assets and liabilities to its own books Dissolves as a separate corporation, often remaining as a division of the acquiring Company. Statutory consolidation through capital stock or asset acquisition ewly created to receive assets or capital stock of original companies !riginal Companies may dissolve while remaining as separate divisions of newly created Company. Acquisition of more than "# percent of the voting stock. Acquires stock that is recorded as an investment controls decision making of acquired company. $emains in e%istence as legal corporation, although now a subsidiary of the acquiring company.
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Transcript of Types of Business Combinations.doc
8/17/2019 Types of Business Combinations.doc
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Business Combinations
Type of Combination Actions of AcquiringCompany
Actions of AcquiredCompany
Statutory mergerthrough assetacquisition
Acquires assets and oftenliabilities.
Dissolves and goes out ofbusiness.
Statutory mergerthrough capital stockacquisition.
Acquires all stock andthen transfers assets andliabilities to its own books
Dissolves as a separatecorporation, oftenremaining as a division ofthe acquiring Company.
Statutory consolidationthrough capital stockor asset acquisition
ewly created to receiveassets or capital stock oforiginal companies
!riginal Companies maydissolve while remainingas separate divisions ofnewly created Company.
Acquisition of morethan "# percent of thevoting stock.
Acquires stock that isrecorded as an investmentcontrols decision makingof acquired company.
$emains in e%istence aslegal corporation,although now a subsidiaryof the acquiring company.
