a)
To define: The term “greenmail”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
b)
To define: The term “white knight”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
c)
To define: The term “golden parachute”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
d)
To define: The term “crown jewels”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
e)
To define: The term “shark repellent”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
f)
To define: The term “corporate raider”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
g)
To define: The term “poison pill”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
h)
To define: The term “tender offer”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
i)
To define: The term “LBO or Leveraged Buyout”.
Introduction:
A merger is a total absorption of one company by another, where the firm that is acquiring retains its uniqueness and terminates the other to exist as an individual entity.
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- Q5. Which of the following factors often affects hostile takeover bids? The takeover premium The composition of the board of the target firm The composition of the ownership of the target’s stock The target’s bylaws All of the abovearrow_forwardMERGER BID On the basis of your answers to problems 21-1 and 21-2, if Hastings were to acquire Visscher, what would be the range of possible prices it could bid for each share of Visscher common stock?arrow_forwardQ5 Which of the following options is correct? Select one: a. Equity represent the net assets of the entity b. An entity can always redeem its shares when it has the excess resources to do that c. Long-term liabilities are part of the owners’ equity d. Preference shareholders are the last to be satisfied among all the stakeholders of the business entity.arrow_forward
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- 1. Kind according to purpose (Choose 1) a. Horizontalb. Verticalc. Product Extentiond. Market Extensione. Congenericf. Conglomerate 2. Kind according to approach to the target firm (Choose 1)a. Friendlyb. Hostile 3. Kind according to acquisition mode (Choose 1) a. Cashb. Equity swapc. Mix of cash and equity swaparrow_forwardThe following are sentences relating to types of mergers and acquisitions. Which is/are true? [S1] Both horizontal and product-extension types of M&A involve catering to the same market group before and after the M&A. [S2] A vertical M&A involves a supplier or buyer of the acting firm as the target firm.a. Only S1 is true.b. Only S2 is true.c. Neither is true.d. Both are true.arrow_forwardMultiple Choice Question: Select the correct option and explain it briefly, Kindly answer both questions. Question-20) Leveraged buyouts are usually done: a). When a company has a small debt load. b) After the stock is issued to make the company public. c) When firms are Well-managed. d) By private equity firms. Question 21) Why is the loss of human capital a concern of downsizing : a). It will lead to huge payouts from lawsuits and early retirements. b). the firm will have to spend significant capital to replace the workers. c) It represents a huge loss of knowledge for the company. d) The remaining workers will be taxed with additional tasks that will slow the efficiency of the organization.arrow_forward
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