Definition: It refers to a process whereby one company or the target is bought out by another company. Further, an acquisition may be full, when the acquirer buys out a hundred percent of the acquiree’s shares, or partial where it buys only a part of its shares. These, however, will always be larger than fifty per cent of the acquiree’s assets.
Acquisitions are a part of a company’s growth strategy whereby it is more beneficial to take over an existing firm’s operations and niche compared to expanding on its own. Acquisitions are often paid in cash, the acquiring company’s stock or a combination of both.