The terms Merger, Acquisition and
Take-over are all part of the M&A parlance. In a merger, the companies
come together to combine and share their resources to achieve common
objectives. The shareholders of the combining firms often remain as joint
owners of the combined entity. An acquisition resembles more of an
arm's-length deal, with one firm purchasing the assets or shares of
another, and with the acquired firm's shareholders ceasing to be owners of
that firm. In a merger, a new entity may be formed subsuming the merging
firms, whereas in an acquisition the acquired firm becomes the subsidiary
of the acquirer firm.
Indian banking has entered M&A era with merger of Times Bank with HDFC Bank.