Asked by Queen Owusu on May 23, 2024

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Which of the following will NOT be regarded as being a barrier to hostile takeovers?

A) targeted share repurchases
B) shareholder rights provisions
C) restricted voting rights
D) cumulative voting

Hostile Takeovers

Hostile takeovers occur when one company tries to acquire another without the consent or cooperation of the target company's management or board.

Targeted Share Repurchases

Also known as greenmail, occurs when a company selectively buys back stock from a potential acquirer at a price that is higher than the market price. In return, the potential acquirer agrees not to attempt to take over the company.

Cumulative Voting

A voting system used in elections, where shareholders multiply the number of shares they own by the number of director positions available to get their total number of votes.

  • Understand the concepts and mechanisms of corporate takeovers and their barriers.
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Nadia AdrianaMay 26, 2024
Final Answer :
D
Explanation :
Cumulative voting is a method that allows shareholders to concentrate their votes on a single candidate for the board of directors, rather than spreading them out among candidates. This can empower minority shareholders and does not directly serve as a barrier to hostile takeovers. In contrast, the other options are defensive measures companies can use to prevent or discourage unsolicited acquisition attempts.