The process of two or more companies combining to form a new company is _______________.

amalgamation

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absorption

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external reconstruction

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internal reconstruction

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Solution

The correct option is C amalgamation
Amalgamation is a combination of one or more companies to form a new entity. Its different from merger as none of the existing companies survive as a legal entity. A completely new organization is formed to hold the assets and liabilities of both the companies which are going in to amalgamation.

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