Absorption merger refers to the merger of two or more enterprises into one enterprise and the absorbed company is dissolved. The creditor's rights and debts of the merging parties shall be inherited by the surviving company or the newly established company after the merger. After the merger, the merged enterprise obtains the assets and liabilities of one or more other enterprises by paying cash, issuing stocks or other consideration, and continues to retain its legal person status, while the other one or more enterprises lose their independent legal person status after the merger.
Legal objectivity:
Article 172 The merger of companies may take the form of absorption merger or new merger. A company absorbs other companies for merger, and the absorbed company is dissolved. The merger of two or more companies to form a new company is a new merger, and the parties to the merger are dissolved. Article 173 When a company is merged, all parties to the merger shall sign a merger agreement and prepare a balance sheet and a list of assets. The company shall notify the creditors within 10 days from the date of making the merger resolution and make an announcement in the newspaper within 30 days. Creditors may, within 30 days from the date of receiving the notice, or within 45 days from the date of announcement if they have not received the notice, require the company to pay off debts or provide corresponding guarantees.