10 Questions
A change in the corporate charter making it more difficult for the firm to be acquired by increasing the percentage of shareholders that must approve a merger offer is called a:
supermajority amendment
The positive incremental net gain associated with the combination of two firms through a merger or acquisition is called:
synergy
Which of the following is an advantage of share-for-share mergers?
They do not incur transaction costs related to re-investing
A contract wherein the bidding firm agrees to limit its holdings in the target firm is called a:
standstill agreement
Which of the following is NOT an example of a revenue synergy arising from a horizontal merger?
Savings from closing duplicated facilities.
In a Pac-Man Defence,
Target company makes a counter-bid for the bidder
Which of the following is most likely to be a benefit of two very different companies merging?
Cash flow smoothing.
Which of the following is NOT an example of a cost synergy arising from a horizontal merger A. A bank closing branches where there are two in one small town
The launch of a new product.
In the case of a predatory takeover, the people likely to gain most in the short term are:
The shareholders of the target company.
Generally speaking managers are most likely to put up a defence against a take-over because:
It is likely to disadvantage themselves.
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