Here are the reasons typically;

insurance costs, I know of a couple pending mergers where the combined employee number will result in a reduction of $300-500,000 over what the two entities pay now, separately.

duplication of services, better coordination of assets and reduction of overlap and redundant operations.

better allocation of equipment and help, self explanatory. 

in a better position to bargain with suppliers.

lack of qualified candidates to manage these entities.

there are a few more minor things but these are the largest talking points.