horizontal merger


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Related to horizontal merger: Vertical Merger, Conglomerate merger

Horizontal merger

A merger involving two or more firms in the same industry that are both at the same stage in the production cycle; that is, two or more competitors.

Horizontal Acquisition

The acquisition of one company by another in the same or a similar industry. This is often a part of the market consolidation process, when too many companies exist for the market to support. They then acquire each other in order to create fewer companies that are more competitive. In venture capital, horizontal acquisitions and horizontal mergers may be part of a roll up process.

horizontal merger

A merger between firms that provide similar products or services. Merging one steel manufacturer into another steel manufacturer is an example of a horizontal merger. Horizontal mergers permit the surviving firm to control a greater share of the market and, it is hoped, gain economies of scale. Compare vertical merger.
References in periodicals archive ?
8) An additional result noted in Panel A is that allied targets in horizontal mergers have higher premiums than their nonallied counterparts, with significant mean and median differences (p-value = 0.
The Merger Guidelines apply the standard horizontal merger framework to the acquisition of a firm that is outside the market but committed to entering.
The upshot of Kaplow's paper is a strong recommendation that antitrust analysis abandon market definition altogether, (57) a position taken with somewhat less force in the Horizontal Merger Guidelines (58) and apparently likely to show up soon, at least as to merger analysis, in the influential Areeda Antitrust Law treatise.
A horizontal merger among sellers reduces reported production capacity, increases price, and decreases output.
It remains to be seen if horizontal cooperation is an intermediate step towards market concentration by means of horizontal mergers, or an organizational structure that is also sustainable in the long run.
Whether horizontal mergers among hospitals lead to greater negotiating leverage and higher prices remains a hotly contested issue.
United States Department of Justice and Federal Trade Commission Horizontal Merger Guidelines [section] 4 (rev'd 4/8/97).
For a discussion of Judge Posner's incomplete treatment of the FTC's successful challenge to the Staples-Office Depot merger, which was based in part on econometric analysis of pricing data, see Jonathan Baker, Horizontal Merger Analysis Grows Up: A Review of Chapter Five of Richard Posner's Antitrust Law (2d ed.
In the case of horizontal mergers, the combining firms may secure market power that will harm consumers; or the combining firms may exploit economic efficiencies that will benefit consumers.
Blair explains that with a horizontal merger, the cost savings area are more easily seen.
In the early 1980s, the focus of merger analysis changed in the form of the Federal Trade Commission's (FTC) 1982 Statement Concerning Horizontal Mergers and the DOJ's 1984 Merger Guidelines.
the industry uses a high fraction of its own output), then a horizontal merger can also be classified as vertically related.

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