Deck 2: History of Mergers

Question 1

Moeller, Schlingemann, and Stulz showed that the deals of the fifth merger wave destroyed significantly more value than those of the fourth merger wave.

Answer 1

True

Question 2

Antitakeover defense became increasingly sophisticated during the following merger waves:

A) First
B) Second
C) Third
D) Fourth True or False Questions

Answer 2

C

Question 3

The first merger wave was significantly curtailed by the Sherman Antitrust Act.

Answer 3

False

Question 4

Which of the following types of deals were common in the first merger wave?

A) Horizontal
B) Vertical
C) Oligopolistic
D) None of the above
E) a, b, and c

Question 5

Investment bankers played a prominent role in the first merger wave.

Question 6

Which of the following merger waves were truly global?

A) First
B) Second
C) Third
D) Fifth

Question 7

In the 2000s, which of the following regions/nations exhibited a pattern of heightened M&A volume although the total level varied by the size of the economy?

A) Central and South America
B) Australia
C) Europe
D) All of these
E) None of the above

Question 8

Mitchell and Mulherin, in investigating the deals of the fourth merger wave found that deregulation played a prominent role but that not all industries respond to deregulation the same way with some reacting more quickly than others.

Question 9

LBOs became increasingly popular during the fourth merger wave.

Question 10

The 1940s were a period of intense M&A activity.

Question 11

Roll-ups were not common in the 1990s but became more popular in the 2000s.

Question 12

Investment bankers played a pivotal role in leading many of the deals that took place in the fourth merger wave.

Question 13

Which of the following companies can trace their origins to the first merger wave?

A) General Electric
B) Kodak
C) DuPont
D) a, b, and c
E) Both b and c

Question 14

The Inco-ESB deal was the first hostile takeover in the United States.

Question 15

Which of the following types of deals were common in the third merger wave?

A) Horizontal
B) Vertical
C) Conglomerate
D) None of the above
E) a, b, and c

Question 16

Which of the following factors contributed to the end of the third merger wave?

A) Stock market downturn
B) Economic slowdown
C) Antitrust enforcement
D) None of the above
E) a, b, and c

Question 17

Research has shown that the following factors contribute to the origination of merger waves:

A) Economic shocks
B) Regulatory shocks
C) Technological shocks
D) a, b, and c
E) Both b, and c

Question 18

Answer: The United Technologies takeover of Otis Elevator is an example of a failed merger.