Difference between a merger and an acquisition

One of my colleagues at ESSEC Business School, Rick MARCHESE, is teaching the Mergers and Acquisitions (M&A) course in the Master in Finance on Singapore campus.

He was asked at the beginning of the course what the difference was between a merger and an acquisition.

His answer was: “If you are the buyer, it’s an acquisition. If you are the target, it’s a merger.”

With the recent events in the financial sector, he recently had a great illustration for his definition from two very credible sources…

Press release by UBS

Source: UBS.

and

Press release by Credit Suisse

Source: Credit Suisse.