[ˈdaʊnˈstrim ˈmɜrʤər]
Definition: is the takeover of the parent company by the subsidiary. A downstream merger is a series of economic and legal procedures aimed at bringing together several organizations into one economic unit. The merger procedure is based on the principles of voluntary consent of all parties to the transaction. A downstream merger is understood as the combination of several operating firms, the result of which is the emergence of a single business unit. In the case of a merger, a new legal entity is created that becomes the assignee of all the obligations and rights of the reorganized companies under the deed of transfer, and the participants themselves, considered separate companies before the merger procedure, cease to exist.
Downstream merger in a sentence:
- Downstream mergers and acquisitions of companies are a special class of economic processes for the consolidation of business and capital, occurring at the micro and macroeconomic levels, and as a result of which larger companies are formed in the market in place of several smaller ones.
- Downstream mergers of companies is a transaction made for the purpose of establishing control over an operating company and carried out by acquiring more than 30% of the authorized capital of the company being merged while preserving the legal independence of the company.
Synonyms and related words: merger, spin-off, reorganization
