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 Iowa, mergers and acquisitions (M&A) are governed by state statutes, particularly the Iowa Business Corporation Act, as well as federal law and regulations where applicable. An acquisition in Iowa occurs when one company takes over another, either by purchasing its stock, equity interests, or assets. The acquired company may continue to operate independently, or it may be fully integrated into the acquiring company. A merger, in contrast, is the fusion of two companies into a new entity. Both processes require compliance with various legal requirements, including approval by the boards of directors of the involved companies, shareholder approval in certain circumstances, and adherence to antitrust laws to prevent unlawful monopolies. Additionally, public companies must follow regulations set by the Securities and Exchange Commission (SEC). It is advisable for companies engaged in M&A activities to consult with an attorney to navigate the complex legal landscape and ensure all transactions are conducted lawfully.