What is a Merger?

A merger is an arrangement that combines two current businesses into a single new business. There are various merger types, and businesses merge for a variety of reasons. Mergers and acquisitions (M&A) are frequently carried out to broaden a company's clientele, enter new markets, or increase market share. A merger is the consensual union of two businesses into one new legal entity on largely equal terms. The businesses that agree to join are about similar in size, customer base, and operational scope. The phrase "union of equals" is sometimes used to describe this situation. Contrary to mergers, acquisitions typically entail one firm aggressively purchasing another.

Types of mergers
Depending on the objectives of the organizations involved, there are many sorts of mergers. Some of the most typical merger types are listed below.

Conglomerate
This merger involves two or more unrelated businesses that were formerly separate entities. The businesses may be active in several sectors of the economy or in various geographical locations. A pure conglomerate consists of two distinct companies. On the other side, a mixed conglomerate involves businesses that, despite engaging in unrelated commercial endeavors, unite in an effort to expand their product or market offerings. Companies without any overlap will only merge if it makes sense from the standpoint of shareholder wealth, i.e., if the companies can produce synergy, which includes raising value, performing better, and saving money.

Horizontal
A horizontal merger happens between companies working within the same industry. The merger is ordinarily portion of union between two or more competitors advertising the same items or administrations. Such mergers are common in businesses with less firms, and the objective is to form a bigger trade with more prominent showcase share and economies of scale since competition among less companies tends to be higher.

There are many types of horizontal agreements, some of which are:

1. Price Fixing Agreements:
   Any agreement to fix the price of a product beforehand by the organizations present in the market or by the competitors in the market. In the case of Arizona V Municipal County Medical society, the US court held that the maximum rate limit to be charged by the doctors was invalid as it was against the anti-trust laws. In the case of FICCI Multiplex Association v United Producers, it was held that the distributers and a television channel were involved in anti-trust activities as they fixed prices.
    
2. Limiting and controlling production agreements:
   In these types of agreements, the competitors agree to limit the supply or production in the market to create scarcity in the market to increase the prices of goods and services. In the case of Varca druggist and chemist v Chemist Druggist Association, goa 2012 it was held that forming an organization to regulate the pricing of a product is an anti-competitive practice.
    
3. Market allocation and share:
   In these types of agreements, the competitors agree to divide the market and gain control on it based on geography.
    
4. Bid rigging agreements:
   It is a situation where bidders collude and keep the bid amount at a predetermined rate.

There are 5 ways by which bid rigging happens:

• An agreement to submit identical bids.
• An agreement as to who shall submit the lowest bid.
• An agreement not to bid against each other.
• An agreement to force out the outside bidders.
• An agreement designating bid winners in advance or on a rotational basis.

Vertical
When two companies create parts or administrations for an item merger, the union is alluded to as a vertical merger. A vertical merger happens when two companies working at diverse levels inside the same industry's supply chain combine their operations. Such mergers are done to extend synergies accomplished through the fetched lessening, which comes about from consolidating with one or more supply companies.

1. Tie-in agreements:
   These agreements state that if the consumer buys one product he has to buy the other product only which the older product states. In the case of United States V Microsoft Corporation, 2001it was held that not all tie-in agreements are anti-competitive, some are required for the smooth functioning of a product which is necessary.
    
2. Exclusive supply agreements:
   These are the type of agreements between the firms of same level that state that one firm will only supply the required product to another and no other firm will. These types of agreements are anti-competitive as they create a monopoly in the market and are against the concept of healthy competition. SAIL V CCI, in this case, it was held that no appeal can be filed against the judgment of CCI as it is the only body governing the anti-competitive practices in the market.
    
3. Exclusive distributive agreements:
   These types of agreements are between the producers and the distributors which state that the producer will only supply goods to a particular seller or distributer exclusively.
    
4. Boycott agreements:
   These are the type of agreements which restricts or is likely to restrict, by any method, the persons or class of persons to whom goods are sold or bought.
    
5. Resale price maintenance:
   These are the types of agreements in which the seller stipulates the amount to which the product can be re-sold, it includes any agreement to sell goods on the condition that the prices to be charged on resale by the customer, will be stipulated by the seller.

SPAC MERGERS
It is a type of merger where a publicly traded company or a firm raises capital through the market to acquire another company, the acquired company then becomes a part of the publicly traded company and is then publicly traded in the market.

Conclusion
A combination or a merger is a significant aspect of a market and competition, but it is important to note that such mergers and acquisition should not result in anti-competitive practices which hinder the healthy competition in the market and has appreciable adverse effect on competition. The horizontal and vertical combinations or agreements effect the market negatively and are more prominent, but CCI has the sole responsibility and authority over matters involving anti-competitive activities.