Over the years, many food and beverage producers began merging with other companies. Nabisco merged with a tobacco firm; Campbell's Soup purchased mushroom farms; and, Anheuser-Busch purchased, among others, malt, yeast, and canning companies. Pepsi purchased Kentucky Fried Chicken, Taco Bell, and Pizza Hut. Which of these merging firms engaged in either vertical or conglomerate mergers?
A) none
B) all
C) only Campbell's Soup
D) only Anheuser-Busch
E) only Pepsi

Question

Quizplus · Accepted Answer

Campbell's Soup purchasing mushroom farms is an example of a vertical merger, where a company acquires another in the same industry but at a different stage of production. Anheuser-Busch buying malt, yeast, and canning companies is also a vertical merger, as these are suppliers for its beer production. Pepsi acquiring Kentucky Fried Chicken, Taco Bell, and Pizza Hut represents a conglomerate merger, where a company expands into unrelated businesses.

Over the Years, Many Food and Beverage Producers Began Merging