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Why don't countries, like companies, more often merge?

Modern India could be considered one. The princely states had a choice to be independent when the Brits, but many of them chose to merge into India. Though the ones that chose not to were met with violence (Kashmir, Hyderabad), but many states joined out of socio-economic consideration (large parts of Rajputana), or because of demand from the populace (Travancore).

Though India's immediate post-colonial situation was pretty unique, and isn't quite parallel with modern independent nation states.

Why don't countries, like companies, more often merge?

Autonomy and culture are big points. Mexicans would be losing a lot of autonomy over to the United States, and their culture would to a large degree be overwritten by the more dominant countries culture.

The only situation where I see this working is where no one country can have total power over the others. Something like the EU, if they move towards federation. But even with the relatively loose coupling the EU has, there is plenty of euroskepticism - both founded and unfounded.

In general, the advantages of mergers are not so obvious, while the costs are enormous. You can get many of the benefits of having one country through mechanisms like free trade agreements, open borders, shared currency zones etc.