define vertical merger

Answer 1

A vertical merger is a type of merger in which two companies involved in different stages of the production process or supply chain within the same industry combine. This type of merger typically occurs when a company acquires a supplier or a distributor in order to gain control over the entire production process, reduce costs, improve efficiencies, or expand its market presence. By vertically integrating, companies seek to streamline their operations, increase market power, and potentially create a competitive advantage in the industry.