Merging means that the members of one guild leave it and join another guild. It mostly applies to all members of the guild that is being merged with another, bigger guild. It is usually done as a strategic or economical tactic.
Mergers currently take place as members of a guild individually leave their old guild to join another guild. In the end the abandoned guild loses all Guild Treasury. Has there been any talk about actual guild merging rather than player migration, allowing two leaders to agree to a merge and have the treasury transferred to the receiving guild? Pleeease? =)