The importance of mergers and acquisitions in today's economy

Abstract

Undoubtedly today we live in a time of significant economic change. Mergers and acquisitions have become common business tools, implemented by thousands of companies in world. Driven by a philosophy of shareholder value they not only form a new economic, social and cultural environment, but also enable strong companies grow faster than competitors and provide entrepreneurs rewards for their efforts, ensuring weaker companies are more quickly swallowed, or worse, made irrelevant through exclusion. The article answers the question why mergers and acquisitions (M&As) are important in today's economy. It presents the advantages of M&A deals and underlines their features. It also presents the correlation analysis on selected factors and results of research completed among Lithuanian companies. The article concludes that the number of M&A transactions most likely will increase.