FNBU 3441 Chapter Notes - Chapter 26: Tender Offer

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26. 1 the legal forms of acquisitions: merger or consolidation, acquisition of stock, acquisition of assets. Abs no shareholder meetings/ no vote required. Abs (cid:271)uffi(cid:374)g fi(cid:396)(cid:373) (cid:272)a(cid:374) deal di(cid:396)e(cid:272)tl(cid:455) (cid:449)ith ta(cid:396)get fi(cid:396)(cid:373)"s sha(cid:396)eholde(cid:396)s usi(cid:374)g a te(cid:374)de(cid:396) offe(cid:396) (bypassing management and the board) Abs o(cid:272)(cid:272)asio(cid:374)all(cid:455) u(cid:374)f(cid:396)ie(cid:374)dl(cid:455) ( i. e. used i(cid:374) a(cid:374) effo(cid:396)t to (cid:272)i(cid:396)(cid:272)u(cid:373)(cid:448)e(cid:374)t the ta(cid:396)get fi(cid:396)(cid:373)"s management; resistance by management often makes the cost higher than the merger) Abs a significant minority may hold out in a te(cid:374)de(cid:396) offe(cid:396) a(cid:374)d the ta(cid:396)get fi(cid:396)(cid:373) (cid:272)a(cid:374)"t (cid:271)e completely absurd. Abs complete absorption of one firm by another requires a merger (many abs are followed up with a formal merger letter. Acquisition classifications: horizontal: same industry, vertical: different steps of the production process, conglomerate: unrelated lines of business. Takeovers: transfer of a control of a firm from one group of shareholders to another, can occur through 3 means: Group attempts to gain controlling seats on the bod by voting new directors.

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