Answer (A) is correct . A merger is a business combination in which an acquiring firm absorbs another firm. The acquiring firm remains in business as a combination of the two merged firms. Thus, the acquiring firm maintains its name and identity. However, approval of the merger is required by votes of the shareholders of each firm.
Answer (B) is incorrect because A consolidation merges two companies and forms a new company in which neither of the two merging firms survives. It is similar to a merger, but one firm is not absorbed by another.
Answer (C) is incorrect because A proxy fight is an attempt by dissident shareholders to gain control of the corporation by electing directors.
Answer (D) is incorrect because Both companies continue to operate separately after an acquisition.
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