Hostile takeovers may be avoided in Canada due to:
A) Canadians are more risk oriented.
B) A white knight investor.
C) companies have cyclical cash flows.
D) closely held companies.

Question

Quizplus · Accepted Answer

A white knight investor is a third party who comes in to merge with or acquire the company being targeted in a hostile takeover, thereby preventing the takeover from going through. This strategy is commonly used in Canada as a defense mechanism against hostile takeovers. The other options such as Canadian risk orientation or cyclical cash flows of companies may not necessarily prevent hostile takeovers. Closely held companies may have stronger control and ownership structures, but they may still be vulnerable to hostile takeovers if the aggressor is powerful enough.

Hostile Takeovers May Be Avoided in Canada Due To