Add-on Acquisition is an acquisition strategy where a company purchases smaller companies to add to its existing operations, enhancing its product offerings or expanding its market reach.

A company might use add-on acquisitions to grow quickly by buying smaller companies that complement its existing business.

What is the difference between add-on acquisition and bolt-on acquisition? An add-on acquisition is when a company buys another small company to expand its own business. A bolt-on acquisition is when a company buys another small company to add new products or services to its existing offerings.

What is the difference between moral hazard and adverse selection? Moral hazard is when someone takes more risks because they`re insured, while adverse selection is when one party has more information than the other before a deal.

Is adverse selection a market failure? Yes, adverse selection can lead to market failure by causing unequal information between buyers and sellers, impacting business decisions and outcomes.

-

Add-on acquisitions help companies grow bigger by buying smaller companies that complement what they already do.

In conclusion, add-on acquisitions allow companies to expand rapidly by purchasing smaller businesses that fit well with their current operations. It helps them grow bigger and stronger in their market.