3 ms·
Kindof off topic, but I find it odd that they are referring to Cruise/GM as a merger. GM is a behemoth compared to Cruise. Isn't that more of an acquisition?
by daveguy 11y ago
Kindof off topic, but I find it odd that they are referring to Cruise/GM as a merger. GM is a behemoth compared to Cruise. Isn't that more of an acquisition? Is merger a legal term? If so, can anyone clarify why this is a merger and not an acquisition?
- peyton 11y agoAccording to Investopedia [1], acquisitions are sometimes negotiated to be called mergers to avoid negative connotations of being "bought out." [1]: http://www.investopedia.com/university/mergers/mergers1.asp http://www.investopedia.com/university/mergers/mergers1.asp
- Bluestrike2 11y agoThe terms are usually used interchangeably. If it's an actual merger, then they'd be merging with a GM subsidiary and not GM itself. Most public companies like GM (most companies in general, even) have a number of subsidiary companies for various reasons, such as asset protection or other financial considerations. GM's subsidiaries are listed on their 10-K filing with the SEC [0]. Sometimes, there might be a specific reason for structuring a deal as a merger rather than an outright acquisition. It could help a company get around a minority shareholder who would otherwise kill a deal if there's no drag-along provision in their shareholders' agreement, for example. But that's unlikely to be the case here. 0. https://www.gm.com/content/dam/gm/en_us/english/Group4/InvestorsPDFDocuments/10-K.pdf https://www.gm.com/content/dam/gm/en_us/english/Group4/Inves...