BU231 Final Exam Review || With Questions & Answers (100% Correct)
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Module
Mergers and Acquisitions
Institution
Mergers And Acquisitions
BU231 Final Exam Review || With Questions & Answers (100% Correct)
BU231 Final Exam Review || With Questions & Answers (100% Correct)
Merger - ANSWER - Merger occurs when two companies come together to form one company. If one of the two original companies survives then the process is called ac...
, BU231 Final Exam Review || With
Questions & Answers (100% Correct)
Merger - ANSWER - Merger occurs when two companies come together to form one
company. If one of the two original companies survives then the process is called
acquisition. If the combination results in a new company then the process is called a
merger. One company is identified as the acquirer and the other is identified as the
target.
Legal Merger - ANSWER - Companies formally agree to combine
Requirements for a Merger of Equals - ANSWER - may have two drafts a new
charter due to the existence of a new corporation. The board from both corporations
must sign off on the merger. SH from both corporations must sign off as the
individual corporation no longer existence. SH's get shares in the new corporation
(same amount as previously)
Requirements for an Acquisition - ANSWER - only SH's from the targeted
corporation have voting rights on the transaction. If they acquiring corporation
already owns 90% in the target corporation then SH's (target) don't get a say
because they can be bought or cashed out in a short-term merger.
If SH's Say No? - ANSWER - If the SH's (any) disagree with the board on the
transaction then the board must go back to negotiation until SH's agree.
How do we get a merger? - ANSWER - In order to get a corporation to legally
merger you get them out of debt or pay them more than they would be willing to offer
for their corporations.
Purchase of assets - ANSWER - in a sale of assets the Acquirer Corporation gives
the Target Corporation either stock or cash in exchange for the Target Corporation's
assets.
Requirements for purchasing - ANSWER - the acquiring corporation boards have a
voting right not the SH's. The targeted corporation boards and SH's have a voting
right. The acquired corporation must take the targeted corporation debt and targeted
corporation SH's get compensation.
How do you get the board? - ANSWER - By the purchasing the assets for more than
they are worth
Discharge - ANSWER - No Further Legal Effect
Ways to Breach - ANSWER - Express Repudiation (at time of performance,
anticipatory breach)
Failure to Perform
Self-induced Frustration
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