Why would a company want to acquire another company?

Several possible reasons:

• The buyer wants to gain market share by buying a competitor.

• The buyer wants to gain market share by buying a competitor.

• The buyer believes the seller is undervalued.

• The buyer wants to acquire the seller’s customers so it can up-sell and cross-sell to them.

• The buyer thinks the seller has a critical technology, intellectual property or some other “secret sauce” it can use to significantly enhance its business.

• The buyer believes it can achieve significant synergies and therefore make the deal accretive for its shareholders.