Types of Acquisitions
I have recently saw some comments that Digital Turbine (aka APPS) grows its revenue through acquisitions. In my opinion, this comment is a bit short sighted.
In every acquisition, I believe, as investors, we must be able to find out what do the new company brings to the table.
There are many reasons a company makes an acquisition. It could be for the technology capabilities, for the patents, for the know-how, for the talents, for the customers or entering into another industry. But eventually, it is the expectations that it will lead to a higher revenue in the future.
In my opinion, there are 2 basic type of acquisitions:
(1) An acquisition that expands a company's TAM within the same market.