A stock swap takes place when the shares of stock of one company are exchanged for the shares of another company usually in connection with an acquisition or merger. In most stock swaps a larger company exchanges some of its shares for 100% of the shares of a target company that is being acquired. A stock swap may also occur where the acquiring company exchanges bonds for 100% of the stock of the acquired company. Sometimes a stock swap, also known as a stock for stock transaction, may include some cash payment in addition to stock of the acquiring company.

Stock certificates are physical documents that represent a shareholder's ownership in a corporation. The corporation may be a public or private company. Stock certificates include information, including the number of shares owned, the date the stock certificate was issued, an identification number, sometimes a corporate seal, and an authorized signature which may be an electronic signature. Today, stock certificates are not always used by corporations. Stock ownership may be recorded electronically and maintained by the corporate secretary. The first stock certificates were issued in 1606 by the Dutch East India Company which was a public trading company.

Mergers and Acquisitions

Stock Legends

Economies of Scale

Reasons for Mergers and Acquisitions

Business Sales - Payment Structures and Payment Options