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Simple English definitions for legal terms
corporate acquisition
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A quick definition of corporate acquisition:
Corporate Acquisition: When one company buys another company, but both companies continue to exist as separate legal entities after the purchase. This is different from a merger, where the two companies combine to form a new entity.
A more thorough explanation:
Corporate acquisition refers to the process of one company taking over another company, while both companies continue to exist legally after the transaction. This is different from a merger, where two companies combine to form a new entity.
- When Facebook acquired Instagram, Instagram continued to operate as a separate company, but under the ownership of Facebook.
- When Disney acquired Pixar, Pixar remained a separate entity, but became a subsidiary of Disney.
These examples illustrate how corporate acquisition allows one company to gain control over another company, while still allowing the acquired company to maintain its own legal identity and operations.