Horizontal integration is when a company gets bigger by acquiring competitors in the same field of activity. Vertical integration is acquiring companies involved in other parts of the supply chain, usually to make cost savings. There are two possibilities: backward integration is acquiring suppliers of raw materials or components; forward integration is buying distributors or retail outlets. Companies can also buy businesses in completely different fields, which is known as diversification. This can be done to reduce the risk involved in operating in only one industry - but diversifying into completely different
industries is a risk itself.
Ex. 1 Find pairs of antonyms in A and B.
A: buy, majority, together, friendly, defence, discount, retail, reduce;
B: hostile, mark-up, attack, sell, minority, separately, raise, wholesale.
Ex. 2Find pairs of synonyms in A and B.
A: takeover, share, work together, different, acquire, possible;
B: various, probable, buy, acquisition, stock, collaborate.
Ex. 3Match up the words from A and B.
A: takeover; stock; mobile; joint; poison; field of; supply; cost; raw;
B: venture; market; pill; bid; activity; materials; savings; chain; phones.
Ex. 4Insert the necessary words and translate the sentences.
1. When a company buys another company, it is called ……………
2. When a company joins another company, it is called ……………
3. When a company works together with another company for a
specific project, it is called ……………
4. If a company is willing to be bought, it is called ……………
5. If a company is unwilling to be bought, it is called ……………
6. Being bought by a white knight is a ……………
7. Issuing new shares at a big discount is the …………… defence.
8. An offer to buy shares at a price which is higher than the market
price is a ……………. .
9. Buying companies which are not in the same line of business is
called …………… .
Ex. 5 Summarize the content of A and B.