Vertical merger

Definition

A vertical merger is a business combination between companies that operate at different stages of the production process for a specific product or service. It aims to create a more integrated or efficient supply chain by bringing together disparate parts of the production or distribution process under one corporate umbrella.

Related terms

Horizontal Merger: A merger between companies that operate in the same industry and are direct competitors, aiming to expand their market share.

Conglomerate Merger: A type of merger where two companies in unrelated business areas join forces, diversifying their business interests and reducing risk exposure.

Acquisition: The process where one company takes control of another company by buying a majority stake, often used as a strategy for growth or entry into new markets