This study looks at mergers between companies that make products connected in the supply chain—like a car manufacturer merging with a parts supplier. They compared how profitable it is for a merger to happen in the part-making sector versus the final product-making one. By studying different demand and supply patterns, they discovered that, generally, mergers in the part-making sector make more money. When the demand for parts is steeper than the demand for final products, mergers there are better for profit. Even if the demand curves change, the part-makers tend to benefit more from a merger. This research helps us understand which types of mergers can lead to more profit in connected industries.