Vertical Integration

Vertical Integration is where a company absorbs another company that is in a different part of the same segment, e.g. if a car company bought a car dealership. An example of vertical integration in the media industry would be where the Chinese company Wanda Firm purchased Legendary Pictures, an American film company. This is the first time a major US film corporation has been purchased by a Chinese firm. Vertical integration is in direct contrast to Horizontal Integration.