For some time I was using KDiff as a diff/merge tool. What I missed in Kdiff was syntax highlighting. So I searched around and found Meld which seems to support everything I liked in Kdiff and more! It does require some initial configuration to get the desired workflow – changing font, tab width, enabling syntax highlighting, current line highlighting:
C:\Program Files (x86)\Meld\Meld.exe "A" "B" C:\Program Files (x86)\Meld\Meld.exe "A" "B" "C" --output "D" --auto-merge
The way the merge command works is it has the A file on the left column, C file on the right. The file in the middle is the output D, with B being the base.