Question

In the year 2012, the social media application “Chowpal” acquired “Socialite” at a purchase value of $1 billion. Both the entities operated in the social media industry and offered similar products as part of their photo-sharing services. However, Chowpal intended to further bolster its market position in the social media space, and the acquisition of Socialite exactly fitted in its scheme of plan. The merger eventually helped Chowpal in increasing its market share, eliminating competition, and gaining access to a wider audience. Identify the type of merger:

Options

• Vertical merger 

• Horizontal merger

• Market extension merger

• Product extension merger

Answer 1

Horizontal merger