A horizontal merger is a type of merger which occurs when two or more companies which operate in the same (or similar) industry sectors merge to form a group or amalgamate to form a new company.
Horizontal mergers allow companies to consolidate their efforts and market shares.
Example: Two competing banks – each with their own set of departments handling product creation and delivery – merge to form a banking group. This horizontal merger allows both banks to streamline their operations and cut costs by sharing just one set of product creation and delivery departments.
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