Which type of merger can help avoid takeover attempts by diversifying operations?

The concept of a conglomerate merger is focused on diversification, which can help a company mitigate risks and shield itself from takeover attempts. By acquiring companies in unrelated industries, a conglomerate merger allows the merged entity to spread its operational risk across different sectors. This diversification can make it less attractive as a takeover target, as its performance is not solely tied to one industry or market segment.

A joint venture merger typically involves two or more companies creating a separate entity to pursue a specific project or goal together, rather than merging their entire operations. This does not inherently lead to diversification, as the focus remains on the joint venture's specific purpose.

A vertical merger occurs when a company merges with another company that is either a supplier or a distributor in its supply chain. While this can create efficiencies and enhance market power within a specific industry, it does not diversify operations across different markets, which is crucial to avoid takeover attempts.

A horizontal merger involves the combination of companies that operate at the same level in the same industry, which can lead to increased market share and reduced competition. However, it does not provide the same level of risk diversification that a conglomerate merger does.

In summary, a conglomerate merger is particularly effective for companies seeking to diversify their operations and enhance their