Which of the following is not true about mergers and acquisitions and taxes?
A) Tax considerations and strategies are likely to have an important impact on how a deal is structured by affecting the amount, timing, and composition of the price offered to a target firm.

B) Tax factors are likely to affect how the combined firms are organized following closing, as the tax ramifications of a corporate structure are quite different from those of a limited liability company or partnership.
C) Potential tax savings are often the primary motivation for an acquisition or merger.
D) Transactions may be either partly or entirely taxable to the target firm's shareholders or tax-free.
E) None of the above

Question

Which of the following is not true about mergers and acquisitions and taxes?
A) Tax considerations and strategies are likely to have an important impact on how a deal is structured by affecting the amount, timing, and composition of the price offered to a target firm.

B) Tax factors are likely to affect how the combined firms are organized following closing, as the tax ramifications of a corporate structure are quite different from those of a limited liability company or partnership.
C) Potential tax savings are often the primary motivation for an acquisition or merger.
D) Transactions may be either partly or entirely taxable to the target firm's shareholders or tax-free.
E) None of the above

Quizplus · Accepted Answer

While tax considerations and strategies are certainly important in mergers and acquisitions, potential tax savings are not always the primary motivation for these deals. Other factors, such as growth opportunities, synergies, and diversification may also be significant drivers of M&A activity.

Which of the Following Is Not True About Mergers and Acquisitions