Rajat is manufacturing sweets, later he merged his business with a dairy farm so that it would become cheaper to obtain milk for manufacturing sweets. Identify the type of merger. |
Conglomerate Horizontal Merger Vertical Merger Product Extension |
Vertical Merger |
The correct answer is option (3) - Vertical Merger A vertical merger occurs when two companies in the same supply chain, but at different stages of production or distribution, merge. In this case, the merger is between a sweets manufacturing business and a dairy farm, which are at different stages in the supply chain for the sweets production.
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