Please give an answer to this essay. This is about: Why are mergers and acquisition strategies popular in many firms competing in the global economy?

Good Afternoon classmates

Mergers and acquisitions are popular because they provide an opportunity to grow the market and eliminate competition in a larger market share, it also increase market power, it reduce the cost of new products release into the market and it develops new capabilities. A company can increase their market share and profitability by using resources, another reason a company will face is entering a new market is the costume loyalty and economy but with the correct mergers and acquisition this transition will be easier. Another reason for companies to use acquisitions in the global economy is to create more value for their stakeholders. Most of the time firms earn above average return using acquisition and merge into their markets, also integration can be difficult when companies are coming from different areas but they have to agree in their decisions. Improper target evaluation is dangerous to a firm when the wrong acquisition decision is made.