Quite a few artists are dissolved and reform under a different name but there is rarely a kind of continuity between the two artists. Some artists (and I think that’s mainly orchestras) do actually get merged into new artists, for example when subsidies are cut. One example is the Dutch Radio Symfonie Orkest, itself a merger between the Promenade Orkest and the Omroep Orkest, which in turn merged with the Radio Kamerorkest to form the Radio Kamer Filharmonie, which was finally axed in 2013 due to … cut subsidies (what a surprise!).
I think it would be useful to capture these artist relationships in actual MusicBrainz relationships. But should that be a general “succeeded by” relationship or the more specific ”merged into”? I don’t think we should have relationships like “Chris Cornell and Rage Against the Machine merged into Audioslave”, so the relationship should be pretty well defined.