The activity in mergers and acquisitions in the past century shows a clustering pattern. The clustering pattern is characterized as a wave and they occur in burst interspersed with relative inactivity.
Strategies of acquisitions and mergers are based on synergy between firms that can create value for shareholders. Synergy can be identified in many ways depending upon business rules and industry rules. Mostly, synergy as estimated by strategists is hard to achieve in its full scale. Which is the reason why some takeovers are not successful. But if properly materialized then businesses prosper in the long run. Simply put, achieving synergy means competing better.
Put simply, a takeover is when one company buys another publicly-traded company. 'Publicly traded' simply means that their shares can be bought and sold on the stock market by anyone.
The company doing the bidding (buying) doesn't have to be publicly traded, but they often are.
The idea is that the bidding company will purchase enough of the target company's stock to gain overall control of that company.
There are several different types of takeover which are classified based on legal context and business context. From legal perspective, takeover is of two types. In the context of business, takeover is of three types.