Nowadays, mergers and acquisitions are considered a key strategic option for organizations around the world. According to Huang and Kleiner (2004) mergers and acquisitions have become the primary means by which companies have the opportunity to increase revenues due to factors such as globalization, rapid technological changes, a long-term bull market and barriers strategies for growth. Porter and Singh (2010) admit that mergers and acquisitions play an important role in reallocating resources in an economy. Despite the enormous increase in corporate mergers and acquisitions in recent decades, many studies show that most of them fail (Nguyen and Kleiner 2003). The purpose of this essay is to provide a brief overview of mergers and acquisitions by providing the main key factors behind this trend, the fundamental reasons why they fail and some recommendations for achieving better results in the future. First it must be said that, despite the fact that mergers and acquisitions are considered the same process, they are not exactly the same thing. Shcraeder and Self (2003) argue that mergers represent the consolidation of two organizations into one; while acquisitions are the purchase of one organization from another in which the buyer retains control. Porter and Singh (2010) state that synergy, agency and arrogance are the main reasons for mergers and acquisitions. Seth et al (2000) argue that the synergy motive suggests that the objective of the acquisition is to create a company greater than the sum of the value of the individual companies. Both target and acquiring company managers act in the best interests of their respective shareholders, with the underlying principle of maximizing their wealth through economic gains. The agency reason proposes that mana...... middle of paper ......acquisitions in Australia?”, International Journal of Business and Economics, vol. 9(2), pp.87-103. Ragozzino, R. and Reuer, J.J. (2010). “The opportunities and challenges of entrepreneurial acquisitions”, European Management Review, vol. 80-90 of Corporate Acquisitions", Journal of Business, vol.59, pp. 197-216. Schraeder, M. and Self, R.D. (2003). “Improving Mergers and Acquisitions Success: An Organizational Cultural Perspective”, Management Decision, vol . 41(5), pp. 511-522. Seth, A., Song, K. and Pettit, R. (2000). Journal of International Business Studies, vol. 31(3), pp. 387-405. London: Kogan Page Limited.