Classroom Companion: Business

Company
Number of acquisitions
(by the end of 2020)
Notable acquisitions
Google
240
YouTube for $1.65 billion in 2006
Microsoft
225
LinkedIn for $26 billion in 2016
Apple
121
Beats electronics for $3 billion in 2014
Amazon
103
Whole foods market for $13.7 billion in 2017
Facebook
89
WhatsApp for $19 billion in 2014
eBay
62
Skype for $2.6 billion in 2005
14.2 · Motivations for M&A

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212
14
An examination of the acquisitions carried out by Amazon, Facebook, Google, 
Microsoft, and Apple from 2015 to 2017 (a total of 175 acquisitions) indicates that 
the major motive has been to strengthen the core business of the company and, 
more rarely, to expand into new markets. Quite often the acquiring company shuts 
down the business of the acquired company, even if it is not a direct competitor, so 
that the motive apparently is to get access to core assets such as skills, technologies, 
processes, practices, and IPR. Sometimes, acquisition of startups seems to be sub-
stitutes for R&D. By acquiring promising startups, the project gets proper funding 
and can be realized in shorter time and may gain first-to-market advantages 
(Gautier & Lemesch, 
2020
).
14.3 
 Types of Integration
Horizontal integration and vertical integration are two types of M&A.
Definition 14.3 Horizontal Integration
Horizontal integration implies that a company merges with or acquires another com-
pany in the same market segment.
The motive is either to get rid of a competitor or to build a company with a larger 
customer base and increased economic value. Facebook’s acquisition of WhatsApp 
in 2014 is an example of a horizontal acquisition.