The empirical evidence strongly indicates that the equityholders of the target ﬁrm realize large wealth gains as a result of a takeover bid but the equityholders in the acquiring ﬁrm gain little, if anything.Although there exists no deﬁnitive answer as to why this is the case, several possible explanations have been proposed.List and explain three of these possible explanations for the minimal returns to the acquiring ﬁrm's equityholders.

Question

Quizplus · Accepted Answer

The Answer of The empirical evidence strongly indicates that the equityholders of the target ﬁrm realize large wealth gains as a result of a takeover bid but the equityholders in the acquiring ﬁrm gain little, if anything.Although there exists no deﬁnitive answer as to why this is the case, several possible explanations have been proposed.List and explain three of these possible explanations for the minimal returns to the acquiring ﬁrm's equityholders.

The Empirical Evidence Strongly Indicates That the Equityholders of the Target