It has been suggested that the reason why the stockholders in acquiring ﬁrms may not beneﬁt to
any signiﬁcant degree from an acquisition is because the price paid for the target ﬁrm might equal
that ﬁrm's total value.

Question

Quizplus · Accepted Answer

If the price paid for the target firm equals that firm's total value, there may be no significant benefit for the acquiring firm's stockholders.

It Has Been Suggested That the Reason Why the Stockholders