Which of the following firms would be a takeover candidate?
A) A firm with strong market position,high earnings and low current assets.
B) A firm with strong market position,low earnings and low cash balances.
C) A firm with strong market position,low earnings and high cash balances.
D) A firm with high non-current assets,high earnings and low current assets.

Question

Quizplus · Accepted Answer

A firm with a strong market position and high cash balances is an attractive takeover target because it indicates a strong financial position and the potential for the acquirer to utilize the excess cash for further growth or investments. Low earnings may be a concern for the firm, but this can be a potential opportunity for the acquirer to improve the profits through operational or strategic changes.

Which of the Following Firms Would Be a Takeover Candidate