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Differences Between Consolidation and Merger

What are the differences between consolidation and merger? The following are the differences between consolidation and merger Consolidation is defined as One company acquires another company and takes over the assets and liabilities of the merged company. Merger is defined as Two companies of similar size combine and form one bigger company. Resultant company in Consolidation The company absorbed ceases to exist and only the company which acquired the smaller company exists. Resultant company in Merger: Both the companies involved cease to exist. A new large company comes into existence. Formation of Consolidation: A + B = A, where the firm B is merged into the firm A. Formation of Merger: A + B = C, where C is an entirely new big entity. Other Name for Consolidation: This is also called as absorption. Other Name for Merger: This is also called as amalgamation. Additional content on this topic can be found at http://www.eduxir.com/curriculum/cbse...