What is meaning by acquisition

What is Acquisition?

Acquisition is a broad term used in business, finance, and other fields to describe the process of buying, merging with, or taking over another entity. The entity being acquired is known as the target, while the entity doing the acquiring is known as the acquirer.

Types of Acquisition

There are several types of acquisitions that can be used to grow a business. The most common types are mergers, acquisitions, and takeovers.


Mergers occur when two or more companies combine to form a single entity. In a merger, the target company is usually absorbed into the acquiring company. Mergers are often used to increase market share, reduce costs, and gain access to new technology or markets.


Acquisitions occur when one company buys another company. The acquiring company typically pays a price for the target company, which is usually based on the target company’s assets, liabilities, and future potential. Acquisitions are often used to gain access to new markets, technology, or resources.


Takeovers occur when one company takes control of another company without the target company’s consent. Takeovers can occur through a hostile bid, where the acquirer attempts to buy the target company despite the target company’s resistance, or through a friendly bid, where the target company agrees to the takeover. Takeovers are often used to gain control of a company’s assets or resources.

Benefits of Acquisition

Acquisition can be a powerful tool for business growth. Acquisitions can help a company increase its market share, reduce costs, gain access to new technology or markets, and gain control of a company’s assets or resources. In addition, acquisitions can help a company diversify its business and reduce risk.

Risks of Acquisition

Although acquisitions can be beneficial, they also come with risks. The most common risks include overestimating the target company’s value, underestimating the cost of integration, and overestimating the potential benefits of the acquisition. Additionally, there is always the risk that the acquisition will not be successful, resulting in a loss of money and resources.


Acquisition is a powerful tool for business growth. However, it is important to understand the risks and benefits associated with acquisition before proceeding. By carefully evaluating the target company and the potential benefits and risks of the acquisition, businesses can make informed decisions and increase their chances of success.

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