The Merge stage is a processing stage. It can have any number of input links, a single output link, and the same number of reject links as there are update input links.(according to DS documentation)
Merge stage combines a master dataset with one or more update datasets based on the key columns. The output record contains all the columns from master record plus any additional columns from each update record that are required.
A master record and update record will be merged only if both have same key column values.
The data sets input to the Merge stage must be key partitioned and sorted. This ensures that rows with the same key column values are located in the same partition and will be processed by the same node. It also minimizes memory requirements because fewer rows need to be in memory at any one time.
As part of preprocessing your data for the Merge stage, you should also remove duplicate records from the master data set. If you have more than one update data set, you must remove duplicate records from the update data sets as well.
Unlike Join stages and Lookup stages, the Merge stage allows you to specify several reject links. You can route update link rows that fail to match a master row down a reject link that is specific for that link. You must have the same number of reject links as you have update links. The Link Ordering tab on the Stage page lets you specify which update links send rejected rows to which reject links. You can also specify whether to drop unmatched master rows, or output them on the output data link.