As is the case with most mergers what happened to target firm Gillette's stock and acquiring form P&G's stock on the day their merger was announced?
A)Both stocks rose
B)Both stocks dropped
C)Gillette's stock rose and P&G's stock fell
D)P&G's stock rose and Gillette's stock fell
E)P&G's stock fell and Gillette's stock split

Question

Quizplus · Accepted Answer

Typically, in mergers, the target firm's stock (Gillette) rises due to the premium offered by the acquiring firm, while the acquiring firm's stock (P&G) may fall due to concerns about the cost and integration challenges.

As Is the Case with Most Mergers What Happened to Target