Question

What is Amalgamation ? Discuss its merits.​

Answer 1

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Advantages of Amalgamation

Competition between the companies gets eliminated. R&D facilities are increased. Operating cost can be reduced. Stability in the prices of the goods is maintained.

Answer 2

Explanation:

Amalgamation is a union of two or more companies, made with an intention to form a new company."

In terms of finance, the definition of amalgamation can be given as under.

"Amalgamation is an agreement (deal) between two or more companies to consolidate (strengthen) their business activities by establishing a new company having a separate legal existence."