5 effects of corporate merger
A merger is a consolidation of two or more corporations, which results in one
or more corporations being absorbed into one surviving corporation.[1] The
separate existence of the absorbed corporation ceases, and the surviving
corporation "retains its identity and takes over the rights, privileges,
franchises, properties, claims, liabilities and obligations of the absorbed
corporation(s)."[2]
The effects of a merger are provided under Section 80 of the Corporation Code:
The effects of a merger are provided under Section 80 of the Corporation Code:
SEC. 80. Effects of merger or consolidation. — The merger or consolidation, as provided in the preceding sections shall have the following effects:
1. The constituent corporations shall become a single corporation which, in case of merger, shall be the surviving corporation designated in the plan of merger; and, in case of consolidation, shall be the consolidated corporation designated in the plan of consolidation;
2. The separate existence of the constituent corporations shall cease, except that of the surviving or the consolidated corporation;
3. The surviving or the consolidated corporation shall possess all the rights, privileges, immunities and powers and shall be subject to all the duties and liabilities of a corporation organized under this Code;
4. The surviving or the consolidated corporation shall thereupon and thereafter possess all the rights, privileges, immunities and franchises of each of the constituent corporations; and all property, real or personal, and all receivables due on whatever account, including subscriptions to shares and other choses in action, and all and every other interest of, or belonging to, or due to each constituent corporation, shall be taken and deemed to be transferred to and vested in such surviving or consolidated corporation without further act or deed; and
5. The surviving or the consolidated corporation shall be responsible and liable for all the liabilities and obligations of each of the constituent corporations in the same manner as if such surviving or consolidated corporation had itself incurred such liabilities or obligations; and any claim, action or proceeding pending by or against any of such constituent corporations may be prosecuted by or against the surviving or consolidated corporation, as the case may be. Neither the rights of creditors nor any lien upon the property of any of such constituent corporations shall be impaired by such merger or consolidation. (Emphasis supplied)
[1] Bank of Commerce v. Radio Philippines Network, Inc., 733 Phil. 491, 510 (2014) [Per J. Abad, Third Division].
[2] Id.