Trading and Investment Terminology
- An acquisition is when one company purchases most or all of another company's shares to gain control of that company.
- It occurs more regularly between small to medium-size firms than between large companies.
- Purchasing more than 50% of a target firm's stock and other assets allows the acquirer to make decisions about the newly acquired assets without the approval of the company’s shareholders.
- Acquisitions, which are very common in business, may occur with the target company's approval, or despite its disapproval.
- With approval, there is often a no-shop clause during the process.