A Merger is a combination of business entities that results in the absorption of the assets, businesses, and liabilities of the merging companies into the acquiring company. This is also known as a takeover and is a form of consolidation of businesses in the same industry to gain market share and compete more effectively against larger competitors.
The most common type of Merger involves two companies that provide the same product or service to a similar target audience. For example, a printing company may merge with a company that sells ink cartridges to create a one-stop shop for all printer needs. This type of M&A is beneficial because it saves resources by avoiding the need for separate infrastructure and staff to support each offering.
Regardless of the type of Merger, the process is often disruptive and challenging for employees. The M&A process can lead to changes in leadership, organizational structure, and team composition which means that some employees will be reassigned or laid off. Those who remain should expect to be working alongside new management and coworkers that they haven’t worked with before. This can lead to a period of uncertainty and feelings of insecurity.
M&As can also affect employee benefits, particularly healthcare plans. HR teams must evaluate benefit offerings and providers to determine the best way forward. This can be a difficult task for many people, especially when they’re dealing with feelings of loss or concern about their job security. Providing information and creating channels for feedback can help to ease concerns during this time of change.