Merits of Merging:

The merits of merging transactions include the following.

i. Merging promotes growth and exploitation of economies scale

ii. Merging companies often enjoy better credit worthiness and therefore better access to investment funds.

iii. It promotes efficient management of resources as different experience are shared and new ideas are introduced

iv. Increase profitability resulting from production expansion and cost reduction. v. It facilitates efficient planning for long term development of the business.

The extent to which any merger transaction could be adjudged as successful depends on the primary motive for it .The motives for merger identified by economists include for growth, economies of scale, monopoly power, increased market valuation, reduction of uncertainty, and to respond to opportunities that may suddenly and unexpectly arise.