Inorganic Growth

Posted in Finance, Accounting and Economics Terms, Total Reads: 2697
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Definition: Inorganic Growth

Inorganic Growth is when a company decides to increase its operations by acquiring new businesses through mergers with similar companies or acquiring business of other companies rather than utilizing its own resources and assets, it is said to be growing inorganically. This leads to a faster growth of the company due to increase in customer base, quicker access to innovation and technology or removing the primary sources of competition in the industry.


Some examples of mergers and acquisitions leading to inorganic growth are:

(i) Arcellor Steel merger with Mittal Steel

(ii) Asoka Mills merger with Aravind Mills

(iii) Tata acquisition of Corus

(iv) Kraft acquisition of Cadbury

(v) Cairn acquisition of Vedanta

 

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