When two company that are equals combine together to create an entirely new company that’s considered a merger. Companies merge for various reasons such as a means to a long-term business strategy or to eliminate competition. There are various types of mergers such as horizontal and vertical mergers. Horizontal mergers are when two companies that offer the same or similar product lines and service and that are in the same industry and stage of production combine. Conversely, the vertical merger is done when two companies have a difference in the stage of production in which they are operating but produce the same goods and services. There are other types of merges, for instance, concentric, conglomerate, and product or market extension