Asked by Suraksha Lamichhane on Jul 09, 2024
Verified
In a ____, the acquiring company offers to buy the target company's shares at a price above market.
A) premium buyout
B) tender offer
C) equity carve-out
D) divestiture
Tender Offer
An offer to purchase some or all of shareholders' shares in a corporation at a specific price for a certain period.
Equity Carve-out
A corporate strategy where a company creates a new, independent company by selling or distributing new shares of its existing business.
- Decode different patterns of mergers and perceive their nuances and resultant implications.
Verified Answer
LH
Le Huu Loi HE141140Jul 15, 2024
Final Answer :
B
Explanation :
A tender offer is when the acquiring company offers to buy the target company's shares at a price above the market price. This offer is open to all shareholders of the target company, not just a select few. This is often seen as a hostile takeover attempt if the target company's management is not on board with the acquisition.
Learning Objectives
- Decode different patterns of mergers and perceive their nuances and resultant implications.