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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.
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.