Question

What are the differences between Merger, Consolidation, and Acquisitions? Support your answer with one recent example from the real world for each type. (Always give detailed information that would support you answer. Any examples given dated before the year 2000 will not be considered).

Answer 1

Solution-
First let's understand the meaning of all three merger,acquisition and consolidation to understand the difference among all three.
A merger is the combination of two companies into one by either closing the old entities into one new entity or by one company absorbing the other. In other words, two or more companies are consolidated into one company.
When one company decides to take over another one, it is referred to as an acquisition. The acquiring company will do this by purchasing either the majority or entirety of the ownership stake of the company being taken over.
A new company does not emerge,Instead, the smaller company is often consumed and ceases to exist with its assets becoming part of the larger company.
Consolidation refers to the combination of several business units or different companies into a single, larger organization. It is also called as Amalgamation.
Consolidation refers to the aggregation of financial statements of a group company as consolidated financial statements.

Real world examples are-
Merger:- When AT&T announced its acquisition of BellSouth in 2006, it emphasized billions of dollars in potential cost savings, but Cingular Wireless -- the wireless company shared by the two telecom providers -- was the real reason behind this combination.In the mid-2000s, Cingular Wireless was the biggest wireless provider in the U.S., with 54 million customers. AT&T owned 60% of it, so it was already a big beneficiary of Cingular's success. However, AT&T recognized that telecom market was moving toward a convergence of television, computers, and wireless accessibility, and that made acquiring the remaining 40% of Cingular that BellSouth owned very important to it. Today, smartphones and tablets are commonly used to access entertainment wirelessly, and AT&T's mobility segment represents 43% of the company's total revenue.

Acquisition: AT&T Buys Time Warner ,On June 15, 2018, AT&T Inc. (T) completed its acquisition of Time Warner Inc., according to AT&T's website.However, due to intervention by the U.S. government to block the deal, the acquisition went to the courts, but in February 2019, an appeals court cleared AT&T’s takeover of Time Warner Inc. The $42.5 billion acquisition will realize cost savings for the combined entity of $1.5 billion and revenue synergies of $1 billion, which are expected to be realized within three years of the close of the acquisition.

Consolidation-In 2015, Target Corp. moved to sell the pharmacy portion of its business to CVS Health, a major drugstore chain. As part of the agreement, CVS Health intended to rebrand the pharmacies operating within Target stores, changing the name to the MinuteClinic. The consolidation was friendly in nature and lessened overall competition in the pharmacy marketplace.