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SS2 Financial Accounting Third Term: Company Amalgamation

What is Company Amalgamation? 

Amalgamation is the blending of two or more existing companies into one company. For example, if two existing companies such as Dangote Flour and Flour Mill Plc go into liquidation to form a new company Dan Flour Mill,  it will be a perfect example of amalgamation.

Amalgamation can also be defined as the combination of one or more companies into a new entity. An amalgamation is distinct from a merger because neither of the combining companies survives as a legal entity; a completely new entity is formed to house the combined assets and liabilities of both companies. This sense of the term amalgamation has generally fallen out of popular use, and the terms “merger” or “consolidation” are often used instead.

Reasons for Amalgamation 

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