Mergers and acquisitions (M&A) is the catch-all term used to refer to the different forms for transferring or consolidating ownership of businesses and assets. Although the terms merger and acquisition are used interchangeably, they have different legal meanings. When one company (the acquirer) purchases the stock, equity interests, or assets of another company, the transaction is called an acquisition. Sometimes an acquired company continues to operate independent of the acquirer, and sometimes the acquired company ceases to operate independently and is absorbed by the acquirer. Mergers, on the other hand, are generally the combination of two companies, and result in the formation of a new company.

In Colorado, mergers and acquisitions (M&A) are governed by state statutes, particularly the Colorado Business Corporation Act for corporations, and other relevant laws for different types of entities. An acquisition occurs when one company takes over another and clearly establishes itself as the new owner. This can be done through the purchase of stock, equity interests, or assets. Post-acquisition, the acquired company may remain independent or be integrated into the purchasing entity. A merger, in contrast, is the fusion of two companies into a new entity, with both companies often ceasing to exist in their previous forms. The resulting entity combines the assets and liabilities of both. The process is subject to various legal requirements, including approval by the board of directors and shareholders of the involved companies, filing appropriate documents with the Secretary of State, and adhering to antitrust laws to prevent anti-competitive practices. It is advisable for companies to consult with an attorney to navigate the complex legal landscape of M&A to ensure compliance with all applicable laws and regulations.