What is vertical merger in SAP FIN-SEM-BCS - Business Consolidation?

SAP Term: vertical merger

• Component: FIN-SEM-BCS

• Component Name: Business Consolidation

• Description: Activity comprising the consolidation of investments which ensures that the investments of the ceding consolidation unit are transferred to an upper unit.

Smart SAP Assistant

• Key Concepts: 
  A vertical merger is a type of corporate consolidation that occurs when two companies that operate at different levels of the same supply chain merge. In the case of SAP Business Consolidation, this means that two companies that are involved in different stages of the same business process, such as production and distribution, can join forces to become a single entity. 
  
  How to use it: 
  In SAP Business Consolidation, vertical mergers can be used to streamline operations and reduce costs. By combining two companies into one, the merged entity can benefit from economies of scale and improved efficiency. Additionally, the merged entity can leverage its combined resources to better compete in the market. 
  
  Tips & Tricks: 
  When considering a vertical merger, it is important to consider the potential risks and rewards associated with the transaction. It is also important to ensure that both companies are compatible in terms of their business models and strategies. Additionally, it is important to ensure that both companies have compatible systems and processes in place to ensure a smooth transition. 
  
  Related Information: 
  Vertical mergers are just one type of corporate consolidation available in SAP Business Consolidation. Other types of corporate consolidation include horizontal mergers, which involve two companies at the same level of the supply chain merging; and conglomerate mergers, which involve two companies from different industries merging.