Nonfinancial motives for mergers include
A) synergy.
B) the portfolio effect.
C) vertical integration.
D) synergy and vertical integration.

Question

Quizplus · Accepted Answer

Nonfinancial motives for mergers often include synergy and vertical integration. Synergy refers to the idea that the combined company can achieve higher efficiency or market power than the two companies separately. Vertical integration involves merging with a company in the supply chain, either a supplier or distributor, to increase control over the production and distribution process.

Nonfinancial Motives for Mergers Include