Mergers and acquisitions have become very common in contemporary business environment. This is because of the increased appetite of corporations to expand their operations into the international markets in order to take advantage of the growing profit potential. In addition, firms are experiencing increased competition in their respective markets, thus finding it more prudent to engage in mergers or acquisitions as a strategy of gaining competitive advantage. This paper will discuss two companies, where one (Walmart) has entered into a merger and diversified internationally, and the other company (D. R. Horton) has concentrated on domestic market without engaging in a merger. Walmart’s Merger with Massmart The contemporary Business environment has become very competitive, forcing many companies to invest in strategies that will make them gain competitive advantage. Most of the large companies are opting for mergers, acquisitions, or internationalization strategies as means of enhancing their operations. One company that has embraced the importance of mergers and acquisitions is Walmart, as it enhances its business penetration across the globe. Walmart is one of the largest retail chains in the world, thanks to its low-price business model. This approach has shown sensitivity to the needs of consumers, leading to the phenomenal growth of the company since its inception in 1962, and forcing the company to spread to foreign markers. Today, Walmart is present in all continents of the world. However, Walmart’s global success has been facilitated by its strategy of merging with retail chains in the destination countries and blending its business model with the cultures of those markets. One of the most high profile mergers that Walmart has been involved in is that of Massmart South Africa (Roberts & Berg, 2012). This merger seems to stand out due to its magnitude and the controversy it generated before its completion. Massmart was one of the leading retailers of general merchandise in Africa prior to merger with Walmart, and operated in 14 countries in Africa. What attracted Walmart is the Massmart’s unique business model of high volume, low margin, and low-cost distribution of branded consumer goods. This is in addition to its segmentation of business operations into four core groups namely Massdiscounters, Masswarehouse, Massbuild, and Masscash, each of which dedicated and specialized in a certain line of business or merchandise. In addition, Walmart viewed the African market as being unexploited and bearing a huge potential for sustainable growth and profitability of business. However, despite the potential benefits that the merger would bring to the economy of South Africa, the government of South Africa expressed explicit resistance and reservations with claims that such a deal would have adverse effect on job market as well as hinder the growth of local manufacturing and production industries. Nevertheless, the deal sailed through, albeit with conditions that saw Walmart take 51% shareholding and the rest going to the local investors. The justification of this merger can be derived from the benefits enjoyed by both firms. First, Walmart gained from entering a well-established market, which was further compounded by the agreement signed with the government and labour unions allowi